Utahns stock up as food prices bite
This is an archived article that was published on sltrib.com in 2008, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

After hearing about a global run on food, Jackie Adams picked up a 25-pound bag of California-grown rice for herself and three more bags for her children.

And while the West Valley City woman was shopping, she also stocked up on a big bag of pinto beans.

"I believe we need to be prepared," said Adams. "And if people don't have any kind of a three-month or a year supply of food, they are going to have to hurry because prices are going up on wheat, rice and other staples."

Shortages of basic food commodities have prompted riots from Haiti to Pakistan, brought on by increasing food demands from developing countries, poor crop yields and rising fuel prices.

Although the United States has escaped shortages seen in poor countries, the nation is contending with the worst bout of food inflation since 1990.

From 2006 to 2007, food prices rose by 4 percent - the highest annual increase since 1990, according to the U.S. Department of Agriculture. And this year, food prices are expected to increase by 3.5 percent to 4.5 percent as retailers pass on higher commodity and energy costs to consumers.

On Thursday, Associated Foods placed some restrictions on rice shipments to retailers such as Harmon's, Dan's and Macey's - only to assure the supply will not be disrupted if there is a panic, said Nate Laver of Associated Foods, a wholesale distributor headquartered in Salt Lake City that serves 600 independent stores in eight states.

It's up to individual retailers whether to restrict sales to shoppers, said Laver. But so far, shoppers have not been snapping up staples, although there has been a slight increase in the sales of rice.

This week, Sam's Club, a division of Wal-Mart Stores, Inc., limited bulk purchases of rice nationwide, including the seven Utah locations, after the Seattle-based Costco Wholesale Corp. imposed similar restrictions in some of its stores.

"We're going to have to come up with solution to how we limit or don't limit bulk rice purchases," said Costco spokeswoman Deb Cain.

"We don't have a timeline on when that decision will be made."

Costco Salt Lake City Store Manager Kevin Campbell declined to identify specific restrictions at his store or Utah's eight other locations, but he did say that customers would not be allowed to buy "a pallet" of rice.

Sam's Club is limiting sales of 20-pound bags of imported jasmine, basmati and long grain white rices to four per member.

"This temporary cap is intended to ensure there is plenty of rice for all our members," the company said in a statement. "No other items are affected."

The restriction does not apply to Wal-Mart stores, to smaller, retail-size rice bags for sale in Sam's or to the chain's retail outlets in New Mexico and Idaho.

Recent concerns of rice stockpiles may have been prompted by China, Brazil, Vietnam, India and Indonesia limiting exports to ensure sufficient supplies for their populations, said Stacy Fitzgerald-Redd, spokeswoman for USA Rice Federation.

Long-grain rice is imported by a broad spectrum of countries in South and Southeast Asia, much of the Middle East, nearly all of Sub-Saharan Africa, and most of Latin America.

Thailand and Vietnam are the world's largest rice-exporting countries, while India is projected to surpass the United States as the third largest rice exporter, according to the U.S. Department of Agriculture.

"In the U.S., there is enough rice for American consumers and our traditional export markets," said Fitzgerald-Redd. "In fact, we export about 50 percent of rice we produce."

Still, U.S. rice futures soared to an all-time high as investors bet that world demand will continue to pressure already dwindling stocks, according to The Associated Press.

Rice for the most actively traded July contract jumped 62 cents to $24.82 per 100 pounds on the Chicago Board of Trade, after earlier rising to a record $24.85.

Price increases from February '06 to February '07

* The Consumer Price Index (CPI) is a measure of the general level of prices in the U.S. economy. According to Kelly Matthews, executive vice president and economist at Wells Fargo Economic Department, the CPI "assumes you buy the exact same things month after month. It's a composition of what's included in a market basket that is purchased by the typical or average consumer."

Just in case

* The U.S. exports half its rice production, capturing 14 percent of the world market.

* Nearly 90 percent of rice eaten in the U.S. is grown here.

* Major rice producers: Arkansas, Texas, California, Louisiana, Mississippi and Missouri.

* About 15,000 U.S. farmers grow rice, with 30 American milling facilities.

No U.S. shortages expected, but some grocers put limits on bulk purchases
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