Price ‘rice’ before Ramadan: Blame it on hoarders
The rice price has begun to soar in anticipation of Ramadan with a 45 percent increase for a 10 kg bag over the past few weeks.
Traders cited upcoming Ramadan and short supplies of the essential commodity from rice exporting countries as reasons for the spike in prices.
It is customary for the prices of rice to increase ahead of Ramadan but this year, there is a sharp rise, most of them said.
The surge is coupled with a shortage of popular brands of basmati rice flying off supermarket shelves, according to customers. The kernel variety of basmati rice, popular among South Asian expatriates has almost vanished along with other long grain varieties that are in short supply.
Moreover, the prices of the precious grain have shot up by 40 percent and are expected to rise further in the coming weeks.
This year is witnessing a shortage of kernel basmati from Pakistan and India, which has triggered the price hike, according to sources. However, the rice shortage is being manipulated by traders looking to make a lucrative profit by spiking the prices of all varieties of including those from Thailand and Vietnam. Even Egyptian rice price has peaked in the last two weeks.
Sources told Arab News that many of the traders are hoarding stocks to trigger a price war during Ramadan.
Although the surge in prices ahead of and during the holy month is a common grievance, this year the shortage is posing a serious problem with India, the largest rice exporting country, having reduced its exports to the Kingdom.
A 10 kg bag of kernel basmati that was earlier priced at SR55 now costs SR80 but is scarce in the market. Several other long grain varieties are also witnessing a price hike with the sela, which was earlier sold at SR65, is now going at SR80. A 40 kg sela bag, which was SR210 a couple of weeks ago, is now SR290.
The Ministry of Commerce has been monitoring the hiked prices and penalizing the traders who violate the ministry’s regulations.
Recently, it slapped penalties of SR80 million, while a leading brand distributor had to pay SR4 million for weight fraud.
Traders blamed the supply-demand principle at the global level for the price hike, saying they have no control over it.