Japan's ongoing rice crisis has intensified calls for tariff policy reform, while spotlighting challenges in production efficiency and the limited commercialization of the nation's agricultural sector, according to a Tokyo-based researcher. To bring down surging rice prices, the Japanese government have decided to sell state-held reserves in recent weeks.
The average price of rice sold at some 1,000 supermarkets nationwide came to 4,260 yen (about 29.76 U.S. dollars) per 5 kilogram, including tax, down 25 yen from the previous week, due to government-stockpiled rice starting to hit store shelves, the Ministry of Agriculture, Forestry and Fisheries said Monday.
However, the latest price is still about double what it was during the same period last year.
Despite the high rice prices and the obvious importance of the staple food to its people, the Japanese government has refused to change entrenched protectionist measures designed to shield small-scale rice farmers through high tariffs and rigid distribution systems.
The government imports about 770,000 metric tons of rice annually with zero tariffs under the "minimum access" quota, with about 100,000 tons designated for staple food use, and the rest is used for processed foods like rice crackers or as feedstuff. A tariff of 341 yen (about 2.39 U.S. dollars) per kilogram is imposed on any rice exceeding this quota.
The high tariff rate has helped pushed up the prices of imported rice and made domestic brands more competitive.
"I haven't made any careful comparison lately, but I feel that our domestic rice is cheaper than imported rice," a Japanese shopper told China Central Television (CCTV) in an interview.
The government's unwillingness to lower tariffs on rice and further open its market has been attributed to the pushback from the Japan Agricultural Cooperatives (JA), the country's largest buyer of rice with significant economic and political clout, due to its influence on how millions of farm households vote in national elections.
The JA has long opposed more foreign rice imports to protect domestic farms from price competitions. Recently, the U.S. government has accused Japan of imposing a 700-percent tariff on imported American rice, making rice duties one of the main focal points in bilateral negotiations. The JA has reportedly pressed Japanese negotiators to not make compromise on the issue.
According to Shunsuke Orikasa, lead research at the Distribution Economic Institute of Japan, said although the JA has the Japanese farmers' interests at heart, it can only offer them short-term support, stressing that this protectionist approach does not help solve the structural problems in Japan's agricultural industry, such as low efficiency.
He believed that in the absence of healthy market competition, Japan's rapidly aging agricultural workforce will not be able to adapt to changes in the market.
"The JA should have focused more on agricultural commercialization with large-scale and highly efficient production. However, the Japanese agricultural sector has failed to keep abreast of the times, resulting in low efficiency in production," he said.
Japan's rice crisis due to high tariffs, structural problems in agriculture sector: analyst
