Panic buying in West Asian market aiding rice, food item exports

A section of rice and food product exporters have reported growing volumes to West Asian countries due to panic buying despite the double freight and triple rise in insurance cost which has led to price increase in those markets.

“Whenever such geopolitical issue had triggered, we had seen actually demand for food going up. In such situations people take double the quantity to store in their houses. So generally demand goes up and this has happened in this case also,” said Rahul Suri, Director, Amir Chand Jagdish Kumar (Exports) Ltd, a Super Star Trading house dealing with rice exports. 

“But the problem is logistics and cost of logistics. Recently many ports in West Asian counties have opened up so there are ways for exports to those markets. But the freight and insurance cost is bit higher,” he said. 

However, customers in those markets are willing to pay premium to procure stocks in such situations because of increased demand, he said.

“Because of increased demand from West Asian markets we do not face any problem in exports,” Mr Suri said.

He said in a situation of double the freight cost and triple insurance cost, the price of products go up by 2 to 3% which is not much at such situations.

“Exports have started going to many impacted West Asian countries. There will be increase in demand as panic buying triggers much more consumption,” Mr Suri added.