Japan’s government will release rice from its strategic reserves directly to large retailers, in a bid to rein in surging prices of the national staple, Farm Minister Shinjiro Koizumi announced on Monday.
The move comes amid mounting public frustration and ahead of upper house elections in July, putting additional pressure on Prime Minister Fumio Kishida’s already unpopular administration.
“The current strategy of auctioning rice from reserves hasn’t worked,” Koizumi said, referencing months of failed attempts to stabilize market prices.
“We’ve now decided to shift to voluntary contracts with major retailers that handle at least 10,000 tonnes annually.”
The rice will begin appearing on store shelves as early as early June, with an initial volume of 300,000 tonnes. Koizumi also signaled the possibility of further releases if demand remains strong.
According to government data released Friday, rice prices in April soared 98.4% year-on-year, slightly exceeding the previous month’s jump an alarming trend for households and a politically sensitive issue in food-conscious Japan.
Koizumi’s appointment follows the abrupt resignation of his predecessor, Taku Eto, who triggered outrage after saying he doesn’t buy rice because he gets it for free a statement that sparked public backlash in the middle of a national food crisis.
Why the Shortfall?
Several factors have contributed to Japan’s rice shortage and resulting price spike:
- Poor harvests due to extreme heat in 2023.
- Panic-buying driven by fears following a major earthquake warning.
- A tourism boom fueling greater consumption.
- Hoarding by traders, anticipating further price increases
New Strategy Targets Market Stability
The government’s decision to bypass the auction system and go straight to large-scale distributors is aimed at restoring supply chain efficiency and cooling down speculative behavior in the market.
Koizumi, the son of former Prime Minister Junichiro Koizumi, also hinted at broader reforms in how Japan manages its food reserves, aligning with efforts to protect consumers and restore public confidence.
