Distribution of Rice Voucher

Prime Minister Sanae Takaichi considers to include an idea of distributing “rice voucher” to consumers in her economic stimulus package in this fall. While the government of Japan has made efforts to bring down rice price, they did not produce outstanding effect. Takaichi is shifting the policy from reduction of price to back up consumers. It is still not sure whether the measure leads to affordable rice.

Former Shigeru Ishiba administration intervened in rice trade market by injecting reserved rice from national storage. Although it temporary reduced the price of rice, it resurged with speculation of future shortage of rice or other reasons. Ishiba administration also changed traditional policy of regulating rice production to maintain rice price and introduced new policy to increase annual production of rice.

 

As soon as Takaichi administration embarked on, Minister of Agriculture, Forestry and Fisheries, Norikazu Suzuki, announced that the government should not intervene in the rice market, denying the policy of Ishiba administration. And Suzuki argued that distributing rice voucher for consumers is further efficient than controlling supply of rice into the market, considering frustration of consumers with shortage and price hike of rice.

 

The rice price still kept in its unusual high at beyond 4 thousand yen per 5 kilograms in average as of late October. Nevertheless, Ministry of Agriculture, Forestry and Fisheries decided to reduce rice production in 2026. While it is regarded as an appeasement to rice farmers and the traders to maintain rice price, there are some concerns that consumers will defy rice, shifting their preference to bread or pasta.

 

Takaichi anyway picked Suzuki’s argument. Takaichi administration is going to deliver supplemental budget for economic stimulus through current session of the Diet, which is expected to be the size of 17 trillion yen as a total. There are some local governments that has already disseminated rice voucher to the people by taking advantage of subsidies from the national government. Takaichi is planning to increase that subsidy for further support for consumers through local governments.

 

However, it is obvious that distribution of rice voucher has no direct impact on reduction of rice price. As Suzuki has denied national government’s intervention to rice market, he has proposed no actual policy to stabilize rice price at an affordable level. In a poll of Asahi Shimbun, only 31 percent of responders thought that rice voucher would have a large impact on measures for price inflation, while 60 percent realized that it would have little impact.

 

Distribution of rice vouchers will require additional cost for sending the voucher to every corner of Japan. It is estimated that the cost for distribution might be 1.5 times higher than the price for rice in consumers’ price. No one in Takaichi administration explains efficiency of rice voucher in the context of overall national agricultural policy.