India’s ban on certain rice exports sends some U.S. consumers scrambling to find it on store shelves

Ali Budner Jul 28, 2023
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The Indian Government said it banned some rice exports to tackle inflation that had been driving rice prices way up for Indian consumers. Narinder Nanu/AFP via Getty Images

India’s ban on certain rice exports sends some U.S. consumers scrambling to find it on store shelves

Ali Budner Jul 28, 2023
Heard on:
The Indian Government said it banned some rice exports to tackle inflation that had been driving rice prices way up for Indian consumers. Narinder Nanu/AFP via Getty Images
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India is the world’s largest rice exporting country. But in an effort to tackle local inflation on prices for this staple crop, the Indian government recently decided to ban foreign exports of non-basmati varieties. That applies to roughly half of India’s regular rice exports.

Even though the United States only imports about 25% of the rice it consumes, news of the ban has stoked fears of shortages here. And some buyers have been stocking up.

Paulraj Karuppasamy is the chef and owner of Paper Dosa, a South Indian restaurant in Santa Fe, New Mexico. His menu boasts a variety of curries, uttapams and dosas — all dishes that rely on rice. 

Recently, he went to place his normal Sam’s Club order of 30 bags to last him a few weeks. That’s when he found out about India’s rice export ban.

“We got some, but we couldn’t able to get what we wanted,” Karuppasamy said.

He tried other vendors too and they were out. Which is weird, Karuppasamy said, because he was actually trying to get basmati rice — which is the one variety India spared from the export ban. Still, Karuppasamy said he’s seeing empty shelves in the rice aisle. 

“A lot of people are buying it in bulk and saving it,” he said.

“People see some big market disruption, and they run out, they panic, they think the sky is falling, prices are going to skyrocket and they might do that in the short term,” said William Ridley, who teaches agricultural and consumer economics at the University of Illinois Urbana-Champaign.

Ridley said there isn’t evidence of dramatic price increases yet, at least in the United States. But even if there is a big spike, he said, the rice market will probably settle. “Prices tend to, you know, tend to mediate and fall back down to some sort of more stable equilibrium,” he said.

But for now, there’s one region in the world that will likely be hit hardest by this ban. 

“Who’s really going to suffer from this is Africa,” said Jeremy Zwinger, owner and CEO of The Rice Trader, an industry-specific publication. He said some African countries depend heavily on Indian rice imports.

So why did India ban some rice exports in the first place? The Indian Government said it made the move to tackle inflation that had been driving rice prices way up for Indian consumers. 

“They’ve had some food inflation that occurred probably due to the Ukrainian Black Sea volatility,” Zwinger said.

Another reason, Zwinger said, could be weather. “There’s a lot of fear in the market about El Niño in Asia that supplies wouldn’t be great.”

He said the Indian monsoon season has brought more rain than usual so far this year which is typically good for rice — but in some places severe flooding has already damaged crops.  

As for Paulraj Karuppasamy at his Indian restaurant in New Mexico — “We have like 15 bags now so I am OK for two weeks,” he said.

If he runs out after that, he said he can always use rice from somewhere else in the world, including the U.S. His curries might just taste … a little different.

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