Will rice trade disruptions affect Namibia?
Export ban could shoot up prices
India, which is the world's largest shipper of rice, banned 80% of exports.
The world’s largest exporter of rice, India, which announced an export ban of the commodity, is Namibia’s second largest import market, according to 2022 data provided by the Namibia Statistics Agency (NSA).
South Africa is Namibia’s top import market for rice. Similarly, India is South Africa’s second largest supplier of rice, Fin24 reported.
Meanwhile, Namibia’s main rice export market in 2022 was Zambia, followed by Angola and Norway, the data indicates. Annual inflation of bread and cereals stood at 17.3% in June.
Analysts have warned the ban could shoot up prices in the long term. Fin24 reported that the ban will affect about 80% of India’s rice exports. While the move may lower domestic prices, it risks sending global costs even higher. Rice is a staple for about half of the world’s population, with Asia consuming about 90% of global supply. India accounts for about 40% of the global rice trade.
FNB senior agricultural economist Paul Makube said South Africa's access to multiple potential suppliers and the current bumper global rice crop, probably meant minimal price implications in the short term. What concerned him, however, was an extended ban by India for more than six months, which could spark global inflationary pressure on the cereal.
"Any disruption to trade, especially mega exporters, has huge implications for prices on the global market. Although there may not be an absolute effect on prices in the short term, if the ban exists for a significant period of time, that will obviously create some form of panic buying from other traditional suppliers and that obviously lifts prices and has inflationary implications."
Panic
India’s move to ban certain rice exports has sparked some panic buying in various countries, with videos on social media showing bags of the staple food flying off the shelves and long lines outside grocery stores.
From the US to Canada and Australia, reports of overseas Indians stocking up are going viral. Some shops have imposed buying limits, while others hiked prices to cash in on the frenzy. Indian restaurants worry about a shortage.
“Over the past few days, people have started buying maybe twice as much rice as usual. So we had to restrict,” said Shishir Shaima, a manager of MGM Spices, an Indian grocery store in Surry Hills in Australia.
The store is now allowing customers to buy only one 5-kilogram bag of rice each. “Some people get mad when we won’t let them buy more than one bag, but we won’t let them,” Shaima said. In the US, videos show people caught up in a buying frenzy.- [email protected]
-Additional reporting Fin24
South Africa is Namibia’s top import market for rice. Similarly, India is South Africa’s second largest supplier of rice, Fin24 reported.
Meanwhile, Namibia’s main rice export market in 2022 was Zambia, followed by Angola and Norway, the data indicates. Annual inflation of bread and cereals stood at 17.3% in June.
Analysts have warned the ban could shoot up prices in the long term. Fin24 reported that the ban will affect about 80% of India’s rice exports. While the move may lower domestic prices, it risks sending global costs even higher. Rice is a staple for about half of the world’s population, with Asia consuming about 90% of global supply. India accounts for about 40% of the global rice trade.
FNB senior agricultural economist Paul Makube said South Africa's access to multiple potential suppliers and the current bumper global rice crop, probably meant minimal price implications in the short term. What concerned him, however, was an extended ban by India for more than six months, which could spark global inflationary pressure on the cereal.
"Any disruption to trade, especially mega exporters, has huge implications for prices on the global market. Although there may not be an absolute effect on prices in the short term, if the ban exists for a significant period of time, that will obviously create some form of panic buying from other traditional suppliers and that obviously lifts prices and has inflationary implications."
Panic
India’s move to ban certain rice exports has sparked some panic buying in various countries, with videos on social media showing bags of the staple food flying off the shelves and long lines outside grocery stores.
From the US to Canada and Australia, reports of overseas Indians stocking up are going viral. Some shops have imposed buying limits, while others hiked prices to cash in on the frenzy. Indian restaurants worry about a shortage.
“Over the past few days, people have started buying maybe twice as much rice as usual. So we had to restrict,” said Shishir Shaima, a manager of MGM Spices, an Indian grocery store in Surry Hills in Australia.
The store is now allowing customers to buy only one 5-kilogram bag of rice each. “Some people get mad when we won’t let them buy more than one bag, but we won’t let them,” Shaima said. In the US, videos show people caught up in a buying frenzy.- [email protected]
-Additional reporting Fin24
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