Japan is set to release 210,000 tons of stored rice into the market in an effort to curb skyrocketing prices, which have surged by over 50% in recent months. Historically, such a measure has only been implemented during natural disasters and poor harvest seasons.
On Friday, Agriculture Minister Taku Eto publicly announced the initiative, as reported by the Japanese Kyodo News. Eto emphasized that while government intervention in the rice market is typically reserved for extraordinary circumstances, the drastic price increase “has had a significant impact on people’s lives,” warranting immediate action.
The surge in rice prices has been attributed to a decline in rice reserves, which have plummeted to their lowest levels since 1999. This shortfall is partly due to a burgeoning demand driven by a record influx of tourists in 2024. Additionally, recent years have seen lackluster harvests, prompting wholesalers to accumulate rice stocks in anticipation of higher future prices.
This marks the first occasion where the Japanese government has intervened in the rice market due to price inflation, rather than in response to an emergency such as a natural disaster.
To prevent a market collapse, the government intends to distribute the stored rice to agricultural cooperatives and wholesalers, with a stipulation that it can repurchase the same quantity within a year. This approach aims to stabilize rice prices and ensure market equilibrium.
Currently, the average price for a 5-kilogram bag of rice stands at 3,688 yen (approximately 23 euros), a significant increase from 2,023 yen last year, based on government research referenced by The Guardian. The government’s intervention seeks to alleviate the economic strain on consumers and restore market stability.