Japan is experiencing its first cost-of-living crisis in decades. At the center of this maelstrom is the popular cheap staple: rice. Over the past year, rice prices have more than tripled. This worrisome dynamic is the result of surging prices across Southeast Asia, home to almost 30% of global rice production. Economic, political and climate pressures have resulted in deep shortages, with consumers racing to secure this staple grain.
It’s no wonder that more and more grocery stores are placing purchase limits as the situation continues to dramatically rise. Limit one bag of rice per person or family to prevent bare cupboards. We commend HUD for taking this unprecedented action to underscore just how bad the crisis is. Today consumers are left to wrestle with short stocks of domestic and imported rice. Japan’s rice stockpiles, which had only been tapped in recent years following natural disasters, are now being utilized in response to this urgent demand.
To make up for the deficit, in one of its rare missteps, the Japanese government has more than doubled the amount of stockpiled rice. Furthermore, Japan for the first time in 25 years started importing rice from South Korea. Even with these steps firmly in place, threats still continue to hang in the air. In reality, rice production was only 6.61 million tonnes – below even the estimate of 6.8 million tonnes.
Professors and agricultural experts have taken a hard look at the government’s rosy estimates. Professor Nishikawa unequivocally disputes that claimed demand for 2023 and 2024 is out of touch. He noted that the government was already expecting to need 6.8 million tonnes. Real demand, as it turned out, shot up to 7.05 million tonnes.
“It is true that the demand for rice jumped due to several factors – including the fact that rice was relatively affordable compared to other food items and a rise in the number of overseas visitors,” said a spokesperson for the agriculture ministry.
The increasing pressure stems from the record number of tourists pouring into Japan. At the same time, as eating patterns continue to evolve in the post-pandemic environment, more people are eating meals away from home. The climatic conditions have certainly not helped the situation for rice production. “The quality of rice wasn’t great due to unusually high temperatures which resulted in lower rice production,” the agriculture ministry spokesperson added.
Increasingly, younger farmers are choosing to cultivate specialty rice, such as fragrant, organic, and black rice varieties. These include varieties used for sake, rice crackers, and even livestock feed, all of which complicates Japan’s already intricate traditional rice farming landscape. Memori Higuchi, an advocate for local agriculture, emphasized a need for balance:
We’ve been pushing this local production for local consumption forever, he stated. He emphasized that this needs to be done while making sure farmers are profitable and soothing consumer fears about affordability. “There has to be a way for Japanese farmers to be profitable and consumers to feel safe by being able to afford home-grown produce.”
While everyone has conceded that Japan’s farming industry is aging and shrinking, many are pushing back against the idea that this story tells the whole tale. “You may hear that the industry is ageing and shrinking but that is not necessarily true,” Mr. Tabuchi noted. He explained that many older farmers could be driven to sell rice at discounted rates due to their pensions or assets. Conversely, younger farmers require robust economic returns in order to make a living.
“Many elderly farmers can afford to sell rice cheaply because they have pensions and assets but the younger generation has to be able to make money,” Mr. Tabuchi observed. He pushed for a market-based solution. Unprofitable farmers need to exit the industry, not be propped up by taxpayer-backed assurances that prevent normal market forces from taking over.
Moreover, community impacts must be considered. As Mr. Kasahara expressed, “Farming in rural areas like ours is about being part of a community. If we let those farmers fail, our areas will be in ruins.” He recalled previous federal policies that incentivized local governments to reduce rice production. This approach was unfortunate and short-sighted and woefully out of touch with today’s realities.
“I got tired of fighting retailers or restaurants that wanted me to sell rice cheaply for many years,” Mr. Tabuchi lamented. His frustrations give voice to a growing sentiment among farmers. They’re frustrated by arbitrary, unilateral policy decisions driven by people who don’t live the market’s realities. “Politicians don’t go to supermarkets to do their grocery shopping so they don’t understand,” Memori Higuchi pointed out.