Will there be riots in India for daal-chawal? If indications from other Asian countries are to go by India is also heading for a major rise in food prices especially rice and pulses.
Following the global trend and anticipating a shortage, Central government has raised the minimum price for non-Basmati rice exports to $1,000 per tonne from $650 per tonne (FoB).
The Directorate General of Foreign Trade said in a notification that the floor price for exports has been raised to Rs 40,000 a tonne.
In another development, Jakarta rice prices jumped 30 per cent to an all-time high. This has caused concerns across Asian countries over fresh outbreaks of social unrest. Because, rice is a staple food for more than 2.5 billion people in Asia.
Bangladesh is already witnessing a huge rice shortage and they are fully dependent on India for their rice supply. In India, the government is struggling to keep the inflation under control and has imposed ban on export of non-Basmati rice.
The rise in rice prices in Jakarta happened after Egypt, a leading exporter, imposed a ban on export to keep local prices down.
To add to that, Philippines announced plans for a major purchase of the grain in the international market to boost supplies. Global rice stocks are at their lowest since 1976.
While prices of wheat, corn and other agricultural commodities have surged since late 2006, the increase in rice prices only started in January.
The Egyptian export ban came after a previously poorly enforced curb and follows similar restrictions imposed by Vietnam and India.
As if this was not enough, Cambodia, a small seller, also announced an export ban this week.
These foreign sales restrictions have removed about a third of the rice traded in the international market.
The Philippines, the world's largest buyer of the grain, said it wanted to purchase 500,000 tonnes after it failed to buy a similar amount earlier this month.
It is struggling to import 1.8m-2.1m tonnes to cover a production shortfall.
Rice is also a staple food in Africa, particularly for small countries like Cameroon, Burkina Faso and Senegal.
These countries are already witnessing social unrest because of high food prices.
Thai rice, a global benchmark, was quoted on Thursday at $760 a tonne, up about 30 per cent from the previous daily quote of about $580 a tonne.
