STORM2K

(There was a story on this yesterday on USA Today but I can't find the link right now)

http://www.nbc11.com/news/15953044/detail.html



Bay Area Shoppers Asked To Limit Rice Purchases

POSTED: 11:55 pm PDT April 21, 2008
UPDATED: 1:36 pm PDT April 22, 2008


The price of a food staple -- rice -- is rising significantly, NBC11 reported.

The price of rice has increased dramatically in recent weeks due to crop failure overseas and resulting hoarding, NBC11 reported.

And at least one Bay Area store is asking customers to hold back on their rice purchases. Costco has posted signs asking customers to follow their regular rice-buying habits.

The rice price increase is a result of a domino effect, NBC11's Noelle Walker reported. Drought in Australia led to a severe decline in rice production that in turn led the world's largest rice exporters to restrict exports. That spurred higher rice prices and hoarding in Asian countries, NBC11 reported.

Now in the United States, rice prices have skyrocketed.

Son Tran owns Le Cheval Vietnamese Restaurant in Oakland.

He said he's seen the price of rice go from $20 to $40 in a matter of weeks.

And Le Cheval's stockpiles are dwindling.

Add to that, the price of vegetables has gone up 50 percent, and some of Tran's regular customers aren't so regular anymore.

The empty tables are a new and troubling trend.

Rice isn't the only food in short supply. The unleavened bread snack matzo, popular with Jewish families during Passover, is also hard to find.

Grocers underestimated demand for the product and one of the main producers of matzo crackers had a problem with one of its ovens on the East Coast, which also shortened supplies.

My heart truly breaks for families who depend on rice to survive...Im sure there are going to be many more hungry little bellies at night now.

I found the other story:

http://www2.nysun.com/article/74994

Food Rationing Confronts Breadbasket of the World
By JOSH GERSTEIN
Staff Reporter of the Sun
April 21, 2008


MOUNTAIN VIEW, Calif. — Many parts of America, long considered the breadbasket of the world, are now confronting a once unthinkable phenomenon: food rationing. Major retailers in New York, in areas of New England, and on the West Coast are limiting purchases of flour, rice, and cooking oil as demand outstrips supply. There are also anecdotal reports that some consumers are hoarding grain stocks.

At a Costco Warehouse in Mountain View, Calif., yesterday, shoppers grew frustrated and occasionally uttered expletives as they searched in vain for the large sacks of rice they usually buy.

"Where's the rice?" an engineer from Palo Alto, Calif., Yajun Liu, said. "You should be able to buy something like rice. This is ridiculous."

The bustling store in the heart of Silicon Valley usually sells four or five varieties of rice to a clientele largely of Asian immigrants, but only about half a pallet of Indian-grown Basmati rice was left in stock. A 20-pound bag was selling for $15.99.

"You can't eat this every day. It's too heavy," a health care executive from Palo Alto, Sharad Patel, grumbled as his son loaded two sacks of the Basmati into a shopping cart. "We only need one bag but I'm getting two in case a neighbor or a friend needs it," the elder man said.

The Patels seemed headed for disappointment, as most Costco members were being allowed to buy only one bag. Moments earlier, a clerk dropped two sacks back on the stack after taking them from another customer who tried to exceed the one-bag cap.

"Due to the limited availability of rice, we are limiting rice purchases based on your prior purchasing history," a sign above the dwindling supply said.

Shoppers said the limits had been in place for a few days, and that rice supplies had been spotty for a few weeks. A store manager referred questions to officials at Costco headquarters near Seattle, who did not return calls or e-mail messages yesterday.

An employee at the Costco store in Queens said there were no restrictions on rice buying, but limits were being imposed on purchases of oil and flour. Internet postings attributed some of the shortage at the retail level to bakery owners who flocked to warehouse stores when the price of flour from commercial suppliers doubled.

The curbs and shortages are being tracked with concern by survivalists who view the phenomenon as a harbinger of more serious trouble to come.

"It's sporadic. It's not every store, but it's becoming more commonplace," the editor of SurvivalBlog.com, James Rawles, said. "The number of reports I've been getting from readers who have seen signs posted with limits has increased almost exponentially, I'd say in the last three to five weeks."

Spiking food prices have led to riots in recent weeks in Haiti, Indonesia, and several African nations. India recently banned export of all but the highest quality rice, and Vietnam blocked the signing of a new contract for foreign rice sales.

"I'm surprised the Bush administration hasn't slapped export controls on wheat," Mr. Rawles said. "The Asian countries are here buying every kind of wheat." Mr. Rawles said it is hard to know how much of the shortages are due to lagging supply and how much is caused by consumers hedging against future price hikes or a total lack of product.

"There have been so many stories about worldwide shortages that it encourages people to stock up. What most people don't realize is that supply chains have changed, so inventories are very short," Mr. Rawles, a former Army intelligence officer, said. "Even if people increased their purchasing by 20%, all the store shelves would be wiped out."

At the moment, large chain retailers seem more prone to shortages and limits than do smaller chains and mom-and-pop stores, perhaps because store managers at the larger companies have less discretion to increase prices locally. Mr. Rawles said the spot shortages seemed to be most frequent in the Northeast and all the way along the West Coast. He said he had heard reports of buying limits at Sam's Club warehouses, which are owned by Wal-Mart Stores, but a spokesman for the company, Kory Lundberg, said he was not aware of any shortages or limits.

An anonymous high-tech professional writing on an investment Web site, Seeking Alpha, said he recently bought 10 50-pound bags of rice at Costco. "I am concerned that when the news of rice shortage spreads, there will be panic buying and the shelves will be empty in no time. I do not intend to cause a panic, and I am not speculating on rice to make profit. I am just hoarding some for my own consumption," he wrote.

For now, rice is available at Asian markets in California, though consumers have fewer choices when buying the largest bags. "At our neighborhood store, it's very expensive, more than $30" for a 25-pound bag, a housewife from Mountain View, Theresa Esquerra, said. "I'm not going to pay $30. Maybe we'll just eat bread."

There have been riots in Haiti over the rising price of rice. In fact, it even resulted in their Prime Minister losing his job.

IMHO this story is designed to generate fear (and by extension, ratings). So far we have one store chain in the US (Costco) that failed to order enough grain stocks, and thus the shelves are running a little low. That's food rationing?

I think this story was written up ahead of time, with the writer just waiting for a store to run short so they could add in the store name and take the story to print.

We're a long way from food rationing in th US. But if there have been serious shortfalls in rice production worldwide, that's awful news for the poorer nations.

Another article today:

http://online.wsj.com/article/SB120881517227532621.html


Load Up the Pantry
April 21, 2008 6:47 p.m.
THE JOURNAL ALSO SAYS THAT HIDING CASH IN YOUR MATTRESS (OR IN SOME OTHER SAFE PLACE) IS A GOOD IDEA. NOTICE THAT THEY ARE NOT SUGGESTING PUTTING IT IN A BANK. URL:
I don't want to alarm anybody, but maybe it's time for Americans to start stockpiling food.

No, this is not a drill.

You've seen the TV footage of food riots in parts of the developing world. Yes, they're a long way away from the U.S. But most foodstuffs operate in a global market. When the cost of wheat soars in Asia, it will do the same here.

Reality: Food prices are already rising here much faster than the returns you are likely to get from keeping your money in a bank or money-market fund. And there are very good reasons to believe prices on the shelves are about to start rising a lot faster.

"Load up the pantry," says Manu Daftary, one of Wall Street's top investors and the manager of the Quaker Strategic Growth mutual fund. "I think prices are going higher. People are too complacent. They think it isn't going to happen here. But I don't know how the food companies can absorb higher costs." (Full disclosure: I am an investor in Quaker Strategic)

Stocking up on food may not replace your long-term investments, but it may make a sensible home for some of your shorter-term cash. Do the math. If you keep your standby cash in a money-market fund you'll be lucky to get a 2.5% interest rate. Even the best one-year certificate of deposit you can find is only going to pay you about 4.1%, according to Bankrate.com. And those yields are before tax.

Meanwhile the most recent government data shows food inflation for the average American household is now running at 4.5% a year.

And some prices are rising even more quickly. The latest data show cereal prices rising by more than 8% a year. Both flour and rice are up more than 13%. Milk, cheese, bananas and even peanut butter: They're all up by more than 10%. Eggs have rocketed up 30% in a year. Ground beef prices are up 4.8% and chicken by 5.4%.

These are trends that have been in place for some time.

And if you are hoping they will pass, here's the bad news: They may actually accelerate.

The reason? The prices of many underlying raw materials have risen much more quickly still. Wheat prices, for example, have roughly tripled in the past three years.

Sooner or later, the food companies are going to have to pass those costs on. Kraft saw its raw material costs soar by about $1.25 billion last year, squeezing profit margins. The company recently warned that higher prices are here to stay. Last month the chief executive of General Mills, Kendall Powell, made a similar point.

The main reason for rising prices, of course, is the surge in demand from China and India. Hundreds of millions of people are joining the middle class each year, and that means they want to eat more and better food.

A secondary reason has been the growing demand for ethanol as a fuel additive. That's soaking up some of the corn supply.

You can't easily stock up on perishables like eggs or milk. But other products will keep. Among them: Dried pasta, rice, cereals, and cans of everything from tuna fish to fruit and vegetables. The kicker: You should also save money by buying them in bulk.

If this seems a stretch, ponder this: The emerging bull market in agricultural products is following in the footsteps of oil. A few years ago, many Americans hoped $2 gas was a temporary spike. Now it's the rosy memory of a bygone age.

The good news is that it's easier to store Cap'n Crunch or cans of Starkist in your home than it is to store lots of gasoline. Safer, too.

gtalum wrote:IMHO this story is designed to generate fear (and by extension, ratings). So far we have one store chain in the US (Costco) that failed to order enough grain stocks, and thus the shelves are running a little low. That's food rationing?

I think this story was written up ahead of time, with the writer just waiting for a store to run short so they could add in the store name and take the story to print.

I completely agree. I read this late last night (well, the first part of it... I was tired) and was like... Food rationing?? Are they serious?

And I keep hearing how the price of milk, etc. is skyrocketing. Months ago, it peaked around here at nearly $4/gal. Now it's $3.29 - $3.49 and it's been on sale for $3.00 for many weeks at Kroger. While I've noticed a few things have gone up, I have also noticed a few things that have come down, which is pretty normal.

I get great deals on groceries. Shop Kroger's sales.

Its such a bad idea to hoard food. I try to keep enough for several weeks in case of emergency. My grandparents once heard a rumor about coffee and went bonkers and it went bad before they could use it. The same for oil and ketchup. Its insane. And I'll never forget the toilet paper shortage rumor. The mice in the attic had a field day because they forgot it was up their. I'm not sure about investing against a price increase. I've eaten enough yellow rice and black beans to last the rest of my life. If I never eat another mouthfull (not likely to happen) I will be one happy Cookiely. The world can have my share of rice. Bread is another matter. I could live on hot bread and butter and cuban coffee. Maybe I will go and buy some extra flour and jiffy mix.

Prices for rice overseas has significantly rose. There is a "rice crisis" in the Philippines. Some of my in-laws have told us there have been fights over the lack of rice.

(With that said, it appears some of the wholesale prices are starting to drop again...)

I don't see any food shortage here. However for Third World nations, there is one.

Even here in South Africa which is one of the more developed third world countries we have shortages of many things.Petrol being one,soda drinks (they can't make the fizzzzzz) and food in some cases.

Far more scary are the price increases in food we are experiencing here especially with the raise % which is given.From March to April (same year) Mince meat (ground beef?) went from R37 ($5) a kg to R67 ($9)..Almost doubling in a month.Onions went up 30%...And over the past year here milk has doubled in cost.

The problem is though,overall living costs have gone up 11% but businesses are given a 3-5% raise for it.Which leaves almost everyone (except the really wealthy) in a spot of bother

Luckily, me and my family still got a few packs of rice in the 72-hour emergency food cabinets.

Meso wrote:Even here in South Africa which is one of the more developed third world countries we have shortages of many things.Petrol being one,soda drinks (they can't make the fizzzzzz) and food in some cases.

Far more scary are the price increases in food we are experiencing here especially with the raise % which is given.From March to April (same year) Mince meat (ground beef?) went from R37 ($5) a kg to R67 ($9)..Almost doubling in a month.Onions went up 30%...And over the past year here milk has doubled in cost.

The problem is though,overall living costs have gone up 11% but businesses are given a 3-5% raise for it.Which leaves almost everyone (except the really wealthy) in a spot of bother

Welll that was one of the reasons I got my family out of SA (for the second time)!... the Spar up the road from my house just could not source enough milk. The farmers just dont get the funding they need to produce enough..then with all the Eskom load shedding...welll ya. I feel really bad for people who are on a limited income in SA, the cost of living is getting impossible! Have you by chance seen the price of a decent block of cheese .... That really put a hole in my wallet!

There is no shortage of Matzah in Florida or New York. Nor, have I seen one.
This isn't a surprise. As great as BioFuels are, the moment you couple the food market to the energy market things will get scary. Even the small amount of corn that is being used for ethanol has greatly effected the markets. It really is a scary time in history right now. War, food riots, rising gas prices, faltering economy.... What a mess. I miss the days of the media being upset of a falandering president.

Media is bored. Brittany, Lindsay and Paris are behaving themselves. No major diasters. The primaries are basically SOSOS. So, we have a freak shortage in "premium" brand of rice. Media sees story. Media over-hypes and freaks out (remember they're bored). People, who believes every word (and don't bother to get the story behind the story) the MSM utters, freak out and begin to horde food. Demand increases. Prices increases. Shortages occur. Media says "see I told you so". More people panic. Everyone else get ticked off, because of the media-created, PR stunt. It's called a self-fulfilling prophecy. The speculators are having a field day, first oil, now food . . . next water supplies, and power.

/me hands lurker a gold star

southerngale wrote:/me hands lurker a gold star

that /me only works in chat

Went out today and the front page papers were all about a lack of rice in South Africa,and a posibility of running out soon