Changing Rice Policy Again

With establishment of new administration in October, the government of Japan looks like changing its policy on domestic trade of rice Although the previous administration led by Prime Minister Shigeru Ishiba sought increase of rice production, Sanae Takaichi Cabinet seems to pursue less production to maintain wholesale price. It is questioned whether Takaichi would stabilize steep inflation of rice.

Rice inflation occurred when the Minister of Agriculture, Forestry and Fisheries (MAFF) miscalculated the production of rice in the harvesting season of the fall 2024. The trade market was paralyzed with speculation of shortage of rice and the price was elevated quickly in late 2024. It doubled from early summer in 2024 to May 2025, as traders kept rice in their backyard, being afraid of shortage of rice supply.

 

Ishiba appointed Shinjiro Koizumi to Minister of MAFF in May and Koizumi urged the traders to provide more rice to the market, with a decision of releasing national rice reserve to stabilize the retail price. Ishiba announced increase of rice production in August as a historical change of rice policy. The MAFF had been keeping the level of rice production low to keep rice price stable. However, Ishiba changed that traditional policy.

 

Takaichi appointed a young lawmaker and former officer in MAFF, Norikazu Suzuki, to the Minister of MAFF. Suzuki has been an advocate of regulation in rice production. At his appointment, Suzuki said that he hoped the rice price should be determined within the system of market. It was interpreted that Suzuki would not commit to rice trade and liked to reduce rice production under his leadership.

 

If the government does not take any measure to stabilize rice trade, the price may hike, causing frustration of the consumers. Arguing that he had been misunderstood, Suzuki adjusted his comment that he would commit to stabilization of rice price through controlling balance between supply and demand. Suzuki also said that the government should have released the reserve as early as in the spring of 2024.

 

The MAFF announced that it assumed rice production in 2026 would be 7.11 million metric tons, reducing from the level in 2025 which had been 7.48 million metric tons. It is supposed that the ministry would reduce the production of rice in 2026 to keep rice price at high level as seen in 2025. Suzuki remarked that he considered the balance of supply and demand.

 

It is concerned that an expensive rice may keep the consumers away from rice, shifting their diet from rice to other foods such as bread or pasta. Rice may be less competitive with imported rice from the United States or some countries in Southeast Asia. Prime Minister Sanae Takaichi is involved in diplomacy with allies and neighbor countries or economic measures to stabilize her administration with cooperation with parties. Consumers will be left behind for the time being.

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