Shortage or Panic Buying?: The Reality Behind India's Rice Export Ban in US

Images and videos have emerged showing long queues of NRIs in Dallas, Texas, rushing to purchase and stockpile rice as a precautionary measure.

(Photo: Accessed by The Quint)

Video Producers: Namita Handa, Shohini Bose

Video Editor: Mohd Irshad Alam

The recent decision by the Centre to ban the export of non-basmati white rice on Thursday, 20 July, has caused widespread panic among Indian residents in the United States. WhatsApp forwards and news alerts spreading information about the ban have triggered a surge in panic buying of rice at various stores across the country.

Images and videos have emerged showing long queues of NRIs in Dallas, Texas, rushing to purchase and stockpile rice as a precautionary measure.

It is worth noting that panic buying of rice is not occurring in all states across the US. The ban's impact has been more strongly felt in regions with larger Indian-origin populations, whereas other areas have not experienced such panic-driven buying behaviour.

Giri Bose, an IT specialist in Miami, Florida, mentioned that there had been apprehension within the Indian community in his city. Still, he hasn't observed any long queues like the ones in Dallas. Upon hearing the news about the ban, he and his friends did go to buy non-basmati rice to assess the situation.

Despite the stores having more than enough stock, they could only purchase it at inflated prices, ranging from $5 to $10 higher than usual. He also mentioned that hoarding too much rice is not possible as stores are attempting to settle the situation by limiting purchases to 2 bags per family.

"There is a limitation, they are not selling more than two bags per family per person."

One rice variety that has garnered special attention is Sona Masoori rice, a lightweight medium-grain rice that is a staple within south-Indian communities. While there is a price hike for all kinds of rice in the US right now, bags of Sona Masoori are being sold at an even higher premium, with prices increased by 30% to 40%.

The situation is much calmer in Manhattan, New York. Two Indian grocery stores, namely Little India and New Foods of India, have not faced a shortage of rice supplies or an extreme demand. Both stores are located around Lexington Avenue in an area with a high concentration of South-Asian restaurants. At most, Little India has sold 5 to 8 more bags of rice each day, but there hasn't been any panic situation observed in New York.

The situation is much calmer in Manhattan, New York. Two Indian grocery stores, namely Little India and New Foods of India, have not faced a shortage of rice supplies or an extreme demand.

(Photo Courtesy: Tehsin Pala)

However, there was one last bag of Laxmi Sona Masoori left in the store, priced at $17.99, $7 higher than its usual price of $10.99 for 10 lbs. The store cashier mentioned this is the usual price they sell in Manhattan.

Patel Brothers, a famous store chain of Indian Groceries in the US, has one of its branches in Jackson Heights, Queens, an area with the maximum number of Indian-origin residents in New York. They have a stable supply of rice, including Sona Masoori, and haven't noticed any unusual hoarding either.

Patel Brothers, a famous store chain of Indian Groceries in the US, has one of its branches in Jackson Heights, Queens, an area with the maximum number of Indian-origin residents in New York.

(Photo Courtesy: Tehsin Pala)

However, the situation is a bit more tense on the other side of the Hudson River in New Jersey. Rohit Patil, a resident in Dallas currently visiting Jersey City, stood outside Patel Brothers on Indian Street, contemplating whether he should buy at the hiked prices. "I've heard that the prices have gone up to $50-55."

His girlfriend and friends back in Dallas warned him on call that the situation over there is quite gloomy, and he has no option but to buy the expensive rice.

Non-basmati, especially Sona Masoori, is in high demand, and for Rohit, a south Indian from Karnataka, rice is essential for a good meal. He has also noticed other Indians from different parts of New York and New Jersey coming to Indian Street, which has five major Indian grocery stores, including D-Mart and Big Bazaar, to buy Sona Masoori.

The situation is a bit more tense on the other side of the Hudson River in New Jersey.

(Photo Courtesy: Tehsin Pala)

Customers at these stores were coming across new labels with higher prices. Patel Brothers were selling 10 lbs Laxmi Sona Masoori bags for $20, while Big Bazaar was selling them at $21.99.

Sushma Patel, the owner of Big Bazaar, mentioned that due to the ban, the wholesale price has allegedly increased, and hence they have had to hike the price. These two stores and Apna Bazaar had ample stocks of different varieties of rice, while other stores, such as D-Mart and Siya had very few bags left.

A Siya Cash & Carry store. 

(Photo Courtesy: Tehsin Pala)

The owner of a Siya store , Shankar Malla said:

"Nobody has rice right now, not the supplier, customer, nobody. All the stock was bought on Thursday itself."

Most store owners mentioned an increasing reduction in the supply of non-basmati rice, which is, in turn, creating higher demand for basmati rice. "On the first day, the stock cleared up very quickly. Now because of that, there is pressure on basmati rice," said Shankar Malla.

It’s just been four days after the ban announcement, but none of the stores had huge queues or panic buying situations. In fact, the rice aisles were rarely getting customers.

(Photo Courtesy: Tehsin Pala)

Hemant Khanair from Nasik, who is currently visiting his son in Jersey City, was completely opposed to buying rice at the current expensive prices like many others. He is going to wait it out till things go back to normal because he believes the price hike is due to panicked customers and selfish vendors, not due to a shortage of supply.

On the opposite end of the east coast, similar patterns can be observed in the west. Cities with larger Indian-origin populations are paying the price of panicked individuals. Sudha Rajagopalan, an RJ of a Tamil Radio show based in San Francisco, California, did not think much of the initial WhatsApp forwards she received about the rice ban but panicked when she started to hear about people emptying rice aisles in different stores.

When she reached her usual store, New India Bazar, she came across a huge group of Indians fighting to grab bags of rice, especially Sona Masoori.

(Photo Courtesy: Sudha Rajagopalan)

"I got the same video through another group, and it was a local Milpitas Tamil group, and that's when I started worrying." 

When she reached her usual store, New India Bazar, she came across a huge group of Indians fighting to grab bags of rice, especially Sona Masoori. She ended up getting one bag, hoping the situation fizzles out soon. "Being a South Indian person, we cannot live without eating idlis and dosas, so I took one, ten-pound bag of idli rice and came out."

She decided to try her luck at Costco over the weekend and came across nothing but grains of leftover rice in the aisles. "We wouldn't have been able to sustain ourselves because what we had at home was going to deplete soon. So I went to Costco and see what the situation is, and I go to Costco there were only grains of rice left."

She finally found an online store called Shashta Foods and was able to easily order Sona Masoori online through them.

She later also visited another smaller Indian store called Coconut Hill that had a good stock of Sona Masoori rice, but they were enforcing the one bag per person rule. She and her husband bought two bags for her and her neighbour from the store. She paid $2 to $5 extra for the rice bags at the most but also noticed people rushing from cities near San Francisco with few or non-Indian stores, many buying one bag for a whopping $50.

In the end, it’s the region in the US that determines whether the rice aisles are found empty or not.

(Tehsin Pala is a graduate student at New York University, pursuing a joint master’s degree in Global Journalism and International Relations. She mainly writes about minorities, especially women.)