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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Costco, Sam’s limit rice buys

Marcus Kabel Associated Press

The two biggest U.S. warehouse retail chains are limiting how much rice customers can buy because of what Sam’s Club, a division of Wal-Mart Stores Inc., called on Wednesday “recent supply and demand trends.”

The broader chain of Wal-Mart stores has no plans to limit food purchases, however.

The move comes as U.S. rice futures hit a record high amid global food inflation, although one rice expert said the warehouse chains may be reacting less to any shortages than to stockpiling by restaurants and small stores.

Sam’s Club followed Seattle-based Costco Wholesale Corp., which put limits in at least some stores on bulk rice purchases.

Sam’s Club declined to say if this is the first time it has restricted sales of bulk foods. The limits affect 20-pound bags, not retail-sized portions. Costco President and CEO Jim Sinegal declined to discuss the issue Wednesday with an AP reporter.

Sam’s Club said it will limit customers to four bags at a time of imported jasmine, basmati and long grain white rice.

The warehouse chain caters heavily to small businesses, including restaurants. Sam’s Club spokeswoman Kristy Reed said she could not comment on whether the problem was caused by short supplies or by customers stocking up in anticipation of higher prices.

USA Rice Federation spokesman David Coia said there is no rice shortage in the United States.

“It’s possible that small restaurants and bodega-type neighborhood stores may be purchasing rice in larger quantities than they do typically to avoid higher prices,” Coia said about the warehouse chain restrictions.

A smaller chain, Natick, Mass.-based BJ’s Wholesale Club Inc., said it is not imposing limits for now.

The Sam’s Club restriction is effective immediately at all locations where quantity restrictions are allowed by law. It does not apply to other staples such as flour or oil.

“We are working with our suppliers to address this matter to ensure we are in stock, and we are asking for our Members’ cooperation and patience,” Reed said in a statement.

U.S. rice futures soared to an all-time high Wednesday as investors bet that surging world demand will continue to pressure already dwindling stockpiles. 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.

Relentless demand from developing countries and poor crop yields have pushed rice prices up 70 percent so far this year, raising concerns of severe shortages of the staple food consumed by almost half the world’s population.

The steep increases have followed similar jumps in the price of wheat, corn and soybeans that have added to Americans’ growing grocery bill and led to violent food riots in poor countries including Haiti, Senegal and Pakistan.