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Rice, a staple food, has continued to rise in price for some time, putting a strain on household finances. The government should make an effective release of stockpiled rice and work to stabilize prices as soon as possible.
The Agriculture, Forestry and Fisheries Ministry has revised its operational policy for releasing stockpiled rice. Previously the reasons for the release were limited to a poor harvest, among other situations, but now it can also be released when smooth distribution is disrupted.
The rice will be sold to the National Federation of Agricultural Cooperative Associations (Zen-Noh) and other entities, on the condition that the government buys back the same amount within one year. The specific timing and scale of the release has reportedly not been determined yet.
There has been a clear rise in the price of rice since last summer. However, the agriculture ministry has said that the situation is not right for a release of stockpiled rice, as there has not been a poor harvest and the supply-demand balance has not been tight.
Considering the heavy burden on the public, it is quite natural to make the rules for a release more flexible. In fact, one could say that the move has come too late. It is important for the government to quickly determine when to make the release so that it may ease the public’s burden.
The national rice stockpiling system was established after the Heisei-era rice shortage caused by a historically poor harvest in the 1990s. About 1 million tons are stockpiled in preparation for a once-in-a-decade poor harvest or two consecutive years of lean harvests.
Each year, about 7 million tons of rice are consumed as a staple food, so there is much room for the stockpiled rice to suppress prices.
Behind the ministry’s hesitation to use the stockpiles may also be its long-standing agricultural policies for rice.
The government had tried to curb rice overproduction and keep prices from falling too low through its policy of reducing rice paddy acreage. This policy began to be implemented from the 1970s to ensure a stable income for producers. The system for reducing rice paddy land was abolished in 2018, but the government still subsidizes farmers who shift to other crops to adjust rice production.
It must be said that the government has given too much consideration to producers and has been concerned only about a drop in prices, leading to a lack of a consumer perspective.
Rice production increased in 2024, but unlike the ministry’s forecast, high prices have not subsided. It has been pointed out that this is due to the widespread move by restaurants, wholesalers, retailers and others to quickly secure their own stockpiles in response to soaring rice prices.
The ministry’s slow response has, in some respects, led to concern among distributors and spurred a rice shortage.
The ministry intends to expand the scope of its inventory survey beyond major businesses that buy and collect rice, such as Japan Agricultural Cooperatives, and large-scale wholesalers. In addition to the release of stockpiled rice, it is also important to provide accurate information, in order to stanch the trend toward holding more inventory than is necessary.
The recent price increases have highlighted the growing risk of excessive price fluctuations, mainly due to a lean harvest caused by a heat wave, and increased demand from visitors to Japan. This should also be taken as an opportunity to examine measures for strengthening the production base for rice.
