From today consumers will get rice at a cheaper rate. Leading rice importers made this announcement Friday in view of King Abdullah's decree to cut the price by 20 percent and compensate the dealers. The King ordered subsidy on all existing rice stock estimated at 500,000 tons. Hassan Ugail, the Undersecretary of the Ministry of Commerce, said the ministry would start paying the subsidy for the entire stock including the shipment imported before Jan. 5, 2008, upon the presentation of necessary documents by importers. “It gives us great pleasure to convey this happy news to citizens and residents alike and congratulate them,” said the joint announcement by rice traders. They also sought cooperation from all merchants in implementing the new rice prices from Saturday. Saudi Arabia, which is the largest importer of rice in the Middle East, has seen rice prices going up in recent months. According to Brad Bourland, Chief Economist and Head of Research, Jadwa Investment, a change in Indian consumption patterns is largely responsible for the sharp increase in rice prices in Saudi Arabia. Indian consumers have substituted basmati rice for cheaper and lower quality varieties as their incomes have risen, which combined with a slight decline in production and a broader international shortage (global rice stocks are at a 30-year low) has caused prices to jump, he said. A nine percent fall in the Saudi Riyal against the Indian rupee over the same period has added to the price that Saudi consumers are paying (the bulk of basmati rice on sale in Saudi Arabia is imported from India). Concern over the availability of future supplies has pushed the price for deliveries of Indian basmati rice to the EU up by 90 percent last year. Rice prices have risen by 8.7 percent in the international market since the beginning of last year, according to the UN Food and Agriculture Organisation (FAO). It said last year, rice prices rose to more than $500 per ton in world markets for the first time in 20 years. Major exporting countries such as India, Vietnam and Egypt restricted export of the crop in order to meet growing local demand. The rice importers who made the announcement to reduce the rice prices included Saleh Badr & Sons Trading Company, Al-Muhaidib Foods, Abdul Rahman & Muhammed Al-Shalan Company, Omer Gassem Al-Essayi and Co, Ltd For Marketing, Omer Ali Balsharf Est for Trading, Abdul Aziz Hamad Al-Farys & Sons For Trading, Al-Nafae Trading Holding Company, Al- Namlah & Co For Trading & Services. __
