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Business Standard
9 hours ago
- Business
- Business Standard
India may improve trade deficit with Japan by selling quality rice
India is the world's largest exporter of rice, with its output mainly going to countries in West Asia and Africa. Thousands of rice varieties are harvested in the country, including the glutinous rice (commonly known as sticky rice) in the northeastern states. With the Japanese government considering increasing its rice imports, there is a potential for India to harbour a new trade relationship with this eastern rice-loving friend. Rice is more than a mere staple for Japan; it is near sacred and the country takes pride in its delicious domestic varieties (called Japonica rice) and its self-sufficiency in production. However, in the past months, Japan has been grappling with soaring rice prices: an issue that has created strong economic and political repercussions in the country. As of April-May 2025, rice prices doubled compared to last year reaching a high of 5,000JPY ($35) for 5 kg (a common selling size). As prices soared, rice started to disappear from supermarket shelves, restaurant meals and bowls at home, creating a strong undercurrent of dissatisfaction amongst the consumers. The government undertook some measures to ease prices, like importing additional stocks from the United States, South Korea, Taiwan and releasing a third of its emergency rice stockpiles to reduce the supply pressure. The measures proved ineffective due to the inherent slow and inefficient distribution system, with Japan's powerful protection lobby JA Zen-Noh (National Federation of Agricultural Cooperatives Association) at the centre. A slew of rare and bold measures followed after a political upheaval caused by an insensitive comment by the agriculture minister, who was immediately replaced amidst the economic and now political crisis. The extraordinary measures involved releasing more emergency stockpiled rice, but jumping the JA-led wholesale system to sell directly to retailers and at prices set by the government. This promised to bring prices down to less than half: in the range of 2000 JPY for 5 kg. The measure was executed within a week, rather expeditiously for a usually slow-moving Japan, providing much relief to the people. Buying older harvests of sticky rice is usually not preferred by Japanese households as the rice loses its moistness. This is unlike India, where drier and older rice is preferred as in the case of Basmati. The price pressure was so high, however, that Japanese people queued up outside supermarkets as early as 3 am to purchase the cheaper stockpiled rice. The recent rice inflation was led by both demand- and supply-side factors, some of which may become more long-term constraints in the Japanese economy. Understanding these may be a base for building a new potential trade relationship with Japan in agriculture. Historically, the rice market has been insulated from foreign competition and controlled by the government that regulated production, marketing and distribution, as well as artificially set prices to support small farmers. Japan's Gentan Policy (translated as Reduction Policy) gave monetary incentives to farmers to shift away from rice production to other crops. The policy was discontinued in 2018, but its aftereffects continue to affect production. The government subsidised production of feed rice and set high tariffs on imported rice. The cost of such measures and others is now being borne by Japanese consumers. Another significant supply-side factor is the aging and declining farmer population. The average age of a Japanese farmer is 67.8 years. The number of rice-farming households has fallen from approximately 4.5 million in 1970 to 700,000 in the 2020s. As a result, rice production has reduced steadily from 12.5 million tonnes in the 1970s to 6.7 million tonnes in 2024. However, the present rice inflation is not a result of a sudden fall in production, which in 2024 was marginally more than the previous year. But there was a scare about possible shortages due to adverse weather with unusually harsh summers over the past two years. The earthquake in August 2024 followed by further disaster warnings led to panic buying amongst consumers. Additionally, growing tourism led to strong pressure on rice from the demand side as the island country of 126 million people received a record 36 million tourists in 2024. While some of the above factors were temporary, some may continue to pose challenges for the Japanese market in the long run. As the market factors evolve, it is expected that Japan's need to import rice will grow in the future. The country currently imports about 770,000 tonnes of rice tariff-free under the Minimum Access System of WTO and tariffs are significantly high beyond this quota. A majority of rice imports come from the US, followed by Thailand, China and Australia. Japan's plan to boost rice imports in the coming years, a volatile geopolitical scene and ongoing tariff negotiations with the US, could lead to a reduction in rice tariffs. India's rice exports to Japan comprise mainly the Basmati variety catered to the Indian diaspora. With the ban on non-basmati rice exports lifted last year, certain varieties (such as Joha or chukuwa rice) grown in the Northeastern states can be identified and if required modified to target the taste and quality-sensitive Japanese consumers. Also, as East Asian cuisines such as Korean and Japanese are gaining more popularity, there is also a rising domestic market for sticky rice varieties. Focusing on the international and domestic markets may increase the farm income of the non-basmati growing rice belt, such as farmers in the Northeast. It may also improve India's large trade deficit with Japan.
The Mainichi
14-05-2025
- Business
- The Mainichi
News in Easy English: Rice prices in Japan finally go down a little bit
TOKYO -- In Japan, rice prices became lower for the first time in 18 weeks. This happened because the government started selling rice it had in storage. But experts say rice will still be expensive, because special rice with famous names is still very high-priced. The Ministry of Agriculture, Forestry and Fisheries said on May 12 that supermarkets in Japan now sell rice at an average price of 4,214 yen (about $29) for 5 kilograms. This price is from April 28 to May 4. The price is two times as high as one year before. But it is 19 yen cheaper than the week before. Since mid-March, the government has started selling cheaper stored rice. It already sold about 210,000 tons. At first, not much of this rice reached supermarkets, but now it is slowly becoming easier to buy. This stored rice is usually sold mixed with other rice. It is called "blended rice." At stores, its prices are mostly between 3,500 yen and 4,000 yen (about $24 to $27) for 5 kg. The ministry also said the amount of blended rice at supermarkets is getting bigger each week. In March, blended rice was only around 19% of the total rice sold. By the end of April, it went up and became more than 30%. Most of the stored rice was bought by JA Zen-Noh. JA Zen-Noh is now quickly selling this rice to other sellers, so more rice will soon be in supermarkets. This can help rice prices fall again. Katsuhito Fuyuki, a professor at Tohoku University, said, "The cheaper stored rice is now coming to supermarkets. But famous-name rice like Koshihikari is still very expensive. Because of this, prices probably will not become much cheaper overall." (Japanese original by Hajime Nakatsugawa and Toru Watanabe, Business News Department) Vocabulary average: usual or normal price calculated from many prices. storage: a place where you keep something for later use. blended rice: cheaper rice often mixed from different kinds of rice. ton: a very heavy amount (1 ton = 1,000 kilograms). professor: a teacher at a university who knows a lot about something. famous-name rice (branded rice): special rice with a name that people know, like "Koshihikari". This rice usually costs more money. agriculture: work for growing plants and farming.
The Mainichi
13-05-2025
- Business
- The Mainichi
Average rice price in Japan finally edges down but unlikely to fall significantly
TOKYO -- The nationwide average price of rice in Japan recently marked the first decline in 18 weeks following the release of government stockpiles, but an expert expects the average will not fall by a large margin as branded rice remains quite expensive. The Ministry of Agriculture, Forestry and Fisheries announced May 12 that the average price of rice sold in supermarkets nationwide from April 28 to May 4 was 4,214 yen (around $29) per 5 kilograms, including tax. This represents an increase of 2,108 yen (roughly $14) compared to the same period last year -- roughly twofold -- but it was 19 yen less than the all-time high recorded the previous week. Although the decrease in supermarket rice prices was slight, it marked the first decline in 18 weeks. The ministry believes that more than 30% of the sales volume consisted of affordable blended rice that includes government reserved rice. Whether the price drop will continue remains a focus going forward. Since mid-March, the government has released a total of about 210,000 metric tons of stockpiled rice in sequence. According to the ministry, 3,018 tons, or 1.4%, had reached retailers such as supermarkets by April 13, and the quantity appearing on store shelves is thought to be gradually increasing. Reserved rice is sold mixed with other rice and labeled as blended rice or multiple varieties. Much of the rice is apparently priced between 3,500 to 4,000 yen (approx. $24 to $27) per 5 kg, including tax. While not all blended rice contains stockpiled rice, the ministry's analysis of the sales volume, which is tallied with price data, showed that the ratio of blended rice was 19% for the week of March 10. As reserved rice began to be released from mid-March, the ratio gradually increased, marking 24% for the week of April 7, 28% for the week of April 14, and 31% for the week of April 21. The week starting April 28 is also estimated to have seen a ratio exceeding 30%. Of the approximately 210,000 tons released in two auctions, about 94%, or 199,000 tons, was bought by the National Federation of Agricultural Cooperative Associations (JA Zen-Noh). According to the organization, some 32%, or around 63,000 tons, had been shipped to wholesalers as of May 8. As the agriculture ministry has requested JA Zen-Noh to supply wholesalers ahead of schedule, further price reductions are anticipated with the greater distribution of affordable stockpiled rice. Katsuhito Fuyuki, professor of agricultural market studies at Tohoku University's Graduate School of Agricultural Science, commented, "It seems that cheaper reserved rice has started to reach the retail end. On the other hand, branded rice such as Koshihikari remains at a high price, resulting in a small overall decline. The trading price of branded rice is quite high, and the overall price of rice is unlikely to fall significantly in the future."
The Mainichi
29-04-2025
- Business
- The Mainichi
Rice prices in Japan up for 16th straight week, hit new high despite gov't reserve release
TOKYO -- Rice in Japan's supermarkets hit a record-high average of 4,220 yen including tax (some $30) for 5 kilograms over April 14 to 20, the country's agriculture ministry announced April 28, marking a 3-yen rise from the week prior and the 16th consecutive weekly increase. The announcement from the Ministry of Agriculture, Forestry and Fisheries comes as the average has also risen by 2,132 yen ($14.90) compared to the same period last year -- roughly doubling. Over a month has passed since the national government began to release reserve rice stockpiles in hopes of providing relief, but retail prices remain high. About 210,000 metric tons of reserve rice have been put up for sale in two rounds of bidding so far, with around 94%, or 199,270 tons, won by the National Federation of Agricultural Cooperative Associations (JA Zen-Noh). As of April 24, JA Zen-Noh had shipped about 47,000 tons to wholesalers. However, since it generally takes about two to three weeks for wholesalers' orders from JA Zen-Noh to reach supermarkets and other retailers, it is believed that only a limited amount of the reserve rice had reached store shelves during the survey period. Some local stores that procure rice from smaller regional wholesalers have reported that reserve rice sourced by major wholesalers is not reaching them. In response, on April 16 the government revised the rule that in principle prohibited trade of reserve rice between wholesalers. However, this rule was set to apply in principle only from the third round of reserve rice releases, which was held from April 23 to 25 and covered an additional 100,000 tons. Accordingly, local and small- to medium-sized supermarkets may not have yet received sufficient stocks of reserve rice, which is believed to have also affected survey results. Asked why rice prices remain high, Katsuhito Fuyuki, professor of agricultural market studies at Tohoku University's Graduate School of Agricultural Science, said, "It's possible that demand for rice has exceeded the government's forecasts." He added, "Wholesalers and others are anxious over a possible rice shortage in the summer as seen last year and are likely keeping inventories on hand, also possibly contributing to the high prices." (Japanese original by Hajime Nakatsugawa, Niigata Bureau)
