Business News and Information

The global rice shortage (or hyper-inflated fear of a shortage) has lead to record high prices for the staple grain. In India, the second-largest producer of rice in the world, the price of rice has risen over 70% and the government has banned the export of all varieties of rice except basmati in an attempt to curtail the anticipated domestic shortage.

 This knee-jerk reaction to hoard rice has widespread consequences across the economic spectrum. A story on NBC4.com said "the price of vegetables has also gone up by about 50 percent." I'm no economic genius, but I'm certain it's a very bad thing when the price of staples and necessities (veggies, rice, milk, fuel) increases significantly while the average income remains stagnant (or falls) and the dollar is struggling.

Retailers are rationing rice purchases to keep their shelves from being picked dry. Costco (NASDAQ:COST), Sam's Club, and small ethnic grocers alike are taking steps to prevent hoarding. Lest you downplay the ramifications of hoarding, Philippines President Gloria Arroyo said the rising price of rice is possibly all due to the stockpiling "There could be a possibility of economic sabotage here" [source ]. A conviction of economic sabotage in the Philippines nets a life sentence.