Tuesday, January 25, 2022

Sushi rice prices explode

People who love sushi will have to pay more or go without as the UK is about to experience a significant increase in the price of sushi rice.

Ingredients experts, Eurostar Commodities warn that the since September 2020 freight costs alone have increased approximately 19%. Raw material has increased by approximately 35% due to short supply and very high demand. There may not be enough rice produced globally this harvest to satisfy 100% of demand this year (2021-2022) creating a potential shortage in the market.

Price of paddy rice is increasing and will no longer be available on the open market from March 2022. By Spring, the forecast is that there will be no paddy rice left in the entire global market. There will be 13% less rice available in total volume than the previous year, meanwhile global demand is soaring. This includes round grain and long grain and extends into the various cereal processing industries that are dependent on rice as a key ingredient.

Ingredients expert, Jason Bull, director, Eurostar Commodities, said: “Right now the entire industry is clamouring to buy the rice that they need, and this is driving the price up further. This cycle is going to continue into Spring 2022 increasing prices even further. The prediction is that this will affect the price of products for consumers especially consumption of sushi in restaurants and supermarkets. I have heard industry people describing it even though we are at the beginning of the new harvest ‘the prices are like we are at the end.’”

Much of the sushi rice consumed in the UK comes from paddy fields in Northern Italy where the rice harvest begins in the Autumn. However, Europe does not grow enough rice to fulfil demand and so it is topped up with rice from the rest of the world – but this year they will also have a massive shortfall due to freight and logistical issues. Major rice producing countries include Thailand, Pakistan, Myanmar, Vietnam, South America and Italy. The situation in Italy is that there are continued increases in the price of paddy due to short supply and this is forecast to continue over the next few months.

Compared with one year ago it is now more expensive to transport the product from the far east than it is to produce it. Energy, transport and packaging costs have all increased as well as surcharges being imposed on freight due to ‘UK congestion’ at ports. Lack of drivers is also affecting availability and increasing delays. Total cost of rice has increased dramatically year on year driven by freight rate spikes and limited import options from EBA (duty free) countries.

However, pressure is on Italy’s supply to fulfil domestic demand, and price of global rice is so expensive that it is not a viable option to meet the shortfall.

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