Rice Still Does Not Circulate

To stabilize rice price, Ministry of Agriculture, Forestry and Fisheries (MAFF) decided to release 100 thousand tons of its reserved rice into the market every month through May to July. Six tenths of them will be delivered to supermarkets and small retailers to send them to the ordinary consumers. The ministry also changed the rule of releasing the reserve for the buyers to handle it easier. Nevertheless, rice price still keeps on rising.

The staffs of Ishiba administration did not have any idea that rice price would become a major issue when it was established in October 2024. The rice price did not decline after new rice was traded in the fall of 2024. The Minister of Agriculture, Taku Eto, announced in February that the ministry would release its reserved rice. The government keeps a million ton of rice as the reserve. Prime Minister Shigeru Ishiba ordered Eto in April to release the reserve every month through this summer.

 

The retail price of rice rose for 17 straight months by the end of April. The average price of 5 kilograms of rice was 4,233 yen in the last week of April, two times higher than the price in the same season of last year, which was 2,088 yen. While the price dropped in the first week on May, it hiked again by 54 yen per 5 kilograms in the second week of May. In the poll of Kyodo News, 87.1 percent of responders thought that the government was doing insufficient on rice trade.

 

The MAFF released 312 thousand tons of reserved rice by the end of April, and it will be increased to 612 thousand tons by the end of July. It will occupy 9 percent of all the rice in market in Japan. Among the 100 thousand tons of released reserve, 40 thousand tons will go to supermarkets and 20 thousand tons to the smaller retailers. The policy aimed at avoiding the rice going to restaurants or other food services.

 

The ministry also introduces a new rule. In current rule, the retailer who won the bid for purchasing reserved rice needs in the auction needs to return the same amount of rice to the government within a year. Since it is hard for the retailers to return the rice so soon, they keep the rice in their backyard, leaving the market without enough rice. The MAFF decided to extend the term from 1 year to 5 years.

 

It is not sure that frustration of consumers on expensive rice will be removed by new policies of the government. The policy urges the reserved rice to rapidly go to the retailers by skipping wholesalers. But, the reserved rice is mostly brown rice, not polished. Most supermarkets do not have device for polishing rice. It is supposed that it will take a certain time for the reserved rice to appear on the shelf of supermarkets.

 

At a crucial moment for Ishiba administration to regain confidence on its rice policy, Minister of Agriculture made a careless gaffe. “I have never bought rice, because my supporters give it to me. I have rice in my food stock as much as I can sell it,” said Eto in his speech in Saga on May 18th. Eto later apologized it and retreat his words. Although Ishiba warned Eto of his careless speech, the opposition parties accused Eto as unfit for the position. Rice policy may have negative impact on the Upper House election in July

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