Individuals and families who prepare home-cooked meals can see for themselves the effects of the rice squeeze. Whenever they go to stores to purchase rice, they see the increased prices and acknowledge the limits on purchases.
But what about those who eat out regularly? The recent price hikes in the rice market also affect frequent patrons of Asian restaurants.
Seeming Liang, vice president of Sunnyvale Trading Company Inc., can attest to that. His family-run company supplies wholesale foods to Bay Area Asian and Chinese restaurants, including Calrose, Thai jasmine, and Texan long-grain rice.
Liang said that one company that sells Calrose rice intends to raise its prices later this month by an estimated $7 to $8 per 100 lb. bag. With current market prices for Calrose rice near $35 per 100 lb. bag, customers could end up looking at a 20 percent increase in price.
“We’ve never seen this type of fluctuating, this rapidly, this high, and I’ve been working, 13, 14 years full time,” Liang said. “It’s a pretty precarious balance at this point.”
What’s more, Liang notes that Asian restaurants have taken critical hits lately because prices have gone up in a number of other commodities crucial to Asian restaurants.
“In the past six months, all-purpose flour went up double because of all the shortages,” Liang said. “Soybean oil in the past six to nine months has also gone up. Cooking oil, flour, now your rice has gone up. It’s hard for restaurants to keep prices low for their customers.”
Shortages on rice lead to increased selling prices from farmers. Wholesale distributors, like Sunnyvale Trading Company, must then raise prices to restaurant owners in order to keep pace. This in turn causes owners to either eat up the extra costs or raise the prices on their dishes.
“With everything going up, one right after another, it’s just a domino effect that’s been happening to the retail food market,” Liang said. “It’s hard to see a end at this point.”