Rice Rations

WTF is going on, this is just getting out of control, I could just imagine what is next....looks like sushi prices are going to go through the roof just like pizza and bread did after wheat jumped.....


Wednesday, Apr. 23 2008
Wal-Mart Rations Rice, Warns of "Supply and Demand" Concerns

Wal-Mart, the worlds largest retailer, said on Wednesday that it would ration the amount of rice each customer can purchase because of recent supply and demand trends.

We are limiting the sale of Jasmine, Basmati and Long Grain White Rices to four bags per member visit, the company said in a statement. This is effective immediately in all of our U.S. clubs, where quantity restrictions are allowed by law.

Wal-Mart (WMT: 57.15, +0.60, +1.06%) is the first major grocer to limit the purchasing of a commodity because of the recent run up in prices. The company said it is not limiting the purchase of other basic food products like flour or oil.

The price of rice, which is the primary foodstuff for the majority of the human population around the world, rose to $894 a metric ton according to the Thai Rice Exporters Association. Thats compared to the $327.25 a ton average price in the same month last year.

In Chicago, the price of export-quality rice rose to $24.745 per 100 pounds on Tuesday.

The run up in price in rice is primarily related to poor harvests and countries curbing exports. Thailand, Asias largest exporter of rice, said it may curb exports.

The World Food Program called the recent run up in prices of rice and other basic commodities a silent famine.

Wal-Mart did not say when the rationing would end, but it was working with our suppliers to address this matter to ensure we are in stock, and we are asking for our members' cooperation and patience.

I believe that this run in rice has run its course.

TD,

You could well be right. Where rice is central to the diet (Asia) higher prices are causing inflationary wage demands and civil and political unrest.

If they can't buy rice, let them eat sushi. WTF.

Grant.

This is all just a basic supply & demand issue on a commodity, as the company made clear.

Coffee, Oil, OJ - commodity prices go up, commodity prices go down - in response to and in anticiaption of falling/rising supply/demand.

What do you think happened to sales of rice once Wal-mart announced this? LOL.

And what do you think wil happen to sales of flour and oil (cooking) when they say they aren't going to ration it 'at this time'?

Sure, there has been hoarding of foodstuffs by small retailers, but this is just they're way of trading - buying low and hoping to sell higher. The only diffeecne is they buy the physical rather than the paper or the derivative.

Plus, it's always been a sound strategy to artifically or even physically limit the supply of an item in order to drive up demand, and price.

Where is that really good story about widgets? ISTR a female trader has a women-focused type trading website. I'm sure it was on there. Anyone got it? Excellent.

weeelll let's hold the stagecoach there a second...ration to 4 bags per customer...BUT those bags are 20lbs each...4 by 20lbs....I mean what do you do with 80lbs of rice apart from stagger ...answers on a postcard to 'I like rice with everything'.