Sam's Club Puts Brakes On Sales of Rice

By JOSH GERSTEIN, Staff Reporter of the Sun
April 24, 2008

Sam's Club, the warehouse-style chain owned by Wal-Mart Stores Inc., is curbing rice purchases at its stores amid reports of sporadic shortages and hoarding following a recent price surge and restrictions on rice exports from other countries.

"Due to recent supply and demand trends, we are limiting the sale of Jasmine, Basmati and Long Grain White rices to four bags per member visit," a Wal-Mart spokeswoman, Kristy Reed, said in an e-mailed statement yesterday. "This is effective immediately in all of our U.S. clubs where quantity restrictions are allowed by law."

Ms. Reed said management of the company is seeking to boost its supplies. "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," she said.

The New York Sun reported on Monday that Costco stores in Northern California had thin stocks of rice and were limiting purchases based on customers' prior purchasing history. The Sun's article also said Costco stores in New York and New England had restricted sales of flour and oil due to short inventories. A survivalist quoted in the story reported that some Sam's Clubs were limiting purchases of some staples. On Sunday, a company spokesman told the Sun he was unaware of any shortages or buying limits.

Costco's chief executive officer, James Sinegal, told Reuters Tuesday that his company's headquarters had asked managers to ease the limits. In most cases, customers were simply being asked to buy "reasonable" quantities, he said.

Ms. Reed said Sam's Club had no limits in place "at this time" with respect to food and oil. Wal-Mart stores, which usually sell smaller packages of the food staples, have not restricted sales, she said.

Television news reports following up on the Sun's article Monday showed Bay Area restaurateurs who had stocked dozens and in one case more than 100 50-pound bags of rice as a hedge against future price increases and shortages.