RISING food prices are likely to prove an additional concern for central bankers trying to subdue inflation as the cost of rice – a staple food in Asia – surges the most since 2008, according to HSBC Holdings.

“The memory of the 2008 Asian food price scare sits deep,” economists led by Frederic Neumann said in a research note on Friday (Sep 15). “Back then, rising rice prices in some economies quickly spilt over into other markets as consumers and governments across the region scrambled to secure supplies. It also lifted the prices of other staples, such as wheat, as buyers shifted to alternatives.”

Export prices for rice from Thailand, a global benchmark, jumped to more than US$600 a ton, almost a 50 per cent year-on-year increase. That’s an issue for policymakers because unlike tomatoes and onions, which tend to normalise quickly after a spike because of short harvest cycles, rice prices can stay elevated for much longer, according to Neumann.

Global rice imports as a share of consumption have roughly doubled over the past 25 years, and are up around 4 percentage points since the 2008 food price scare, the note showed. “This means that disruption in one economy could have much bigger spillovers into others than in the past,” Neumann said.

Erratic rains and drought in many parts of the world are hampering crops, reducing supply and driving up costs. Top rice exporter India has imposed curbs on overseas shipments to keep a lid on local prices, further constricting global supplies.

Malaysia and the Philippines are the two Asian economies most reliant on rice imports, followed by Korea and Taiwan, Neumann said. Other economies such as Indonesia are exposed, too. Hong Kong and Singapore import all of their rice, though given their purchasing power they can readily secure supplies.

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“Go easy on the curry,” Neumann concluded. BLOOMBERG