Rice Price Stays High

Price of rice in Japan has been kept at high level since last year. Even after the harvest season of 2024, the price has not declined. The government of Japan decided to release its reserve of the staple diet to stabilize the rice market. However, it is unclear whether the release will work for getting the price down. There rises a criticism on agricultural policy of the government, which has long been restricting production of rice.

Consumers saw unusual landscape that rice disappeared from the shelfs of super markets last summer. It was supposed that unstable weather in 2023 affected circulation of rice in 2024. But the price of rice stopped at high level after the fall 2024. The government refused to release its reserve of rice, arguing that it was reserved for the time of disaster or extremely bad harvest, which invited broad public criticisms.

 

It was mid-February when Ministry of Agriculture, Forestry and Fisheries (MAFF) decided at last to open its storage to stabilize the price of rice. The government tries to keep 1 million tons of reserve of rice every year and announced release of 210 thousand tons as the temporary amount to send it into the market.

 

The first auction of released rice was made in mid-March. MAFF announced on March 14th that average price of successful bids in the auction, in which 142 thousand tons out of prepared 150 thousand tons of rice was traded, was 21,217 yen per 60 kilograms of rice, 4 percent higher than market price. The rice bought by wholesalers will be retailed as early as late March. The price exceeded the average price of rice supplied to the market between the fall of 2024 and January 2025.

 

It is unlikely that the price will decline to the level before the summer of 2024. The treaders are supposed to keep the rice expecting further price hike. MAFF is going to continue the planned release by the end of March, which will be about 70 thousand tons, and refrains from purchasing newly harvested rice in 2025 for the reserve. The ministry now deals with speculative moves in the rice market.

 

Unusually high price of rice supports demand for imported rice. Private import of rice in FY2024 at January 2025 was 991 tons, significantly increased from 368 tons in FY 2023. They are mainly imported from the United States or countries in Southeast Asia. US White House Press Secretary Karoline Leavitt accused Japan of imposing 700 percent of tariff on US rice. Minister of Agriculture, Taku Eto, stressed that US had agreed on a deal over rice at the time of first Trump administration, leaving careless comment that the press secretary was young and beautiful.

 

In 1970s, Japanese government introduced stricter control of rice price to stabilize the market trade. Prime Minister Shigeru Ishiba once tried to finish the control when he was agricultural minister, but faced oppositions from the lawmakers representing agriculture business. As long as political pressure for maintaining rice price to a high position, the governmental control may not work well.