Japan : With latest move, farm ministry sets sights on ¥1,800 for a 5-kg bag of rice
Japan’s agriculture ministry will sell older rice stockpiles to small retailers through no-bid contracts, with 5kg bags priced as low as ¥1,800 (\$12.50). This move aims to cool rising rice prices after auctions failed to lower costs. Larger retailers are excluded for now. Minister Koizumi emphasized broader consumer choice and hinted at future sustainable production reforms.
The agriculture ministry will start selling older batches of stockpiled rice to smaller retailers and rice shops through no-bid contracts, which are likely to be sold at an even lower price: a 5-kilogram bag of rice produced in 2021 is expected to carry a price tag of ¥1,800 ($12.50).
Farm minister Shinjiro Koizumi told reporters on Tuesday night that his ministry will suspend offering no-bid contracts to major retailers after about 70 of them applied to purchase from the government’s stockpile of some 200,000 metric tons of rice harvested in 2022 in less than two days.
It will, instead, start accepting applications from midsize and small supermarkets, as well as rice shops — retailers that sell less than 10,000 tons of rice annually — from as early as Friday, he said.
“This is strictly meant to pour cold water onto the heated market,” Koizumi told a Lower House farm committee on Wednesday, referring to the shift from an auction system to no-bid contracts. The ministry, he said, will discuss long-term measures on how to make rice production more sustainable for farmers when the dust settles.
Once the cheaper rice hits the shelves, supermarkets will have bags of rice for a range of prices.
“There will be the premium brands that cost around ¥5,000, the stockpiled rice sold via auctions that cost somewhere between ¥3,000 and ¥4,000; the ¥2,000 rice from no-bid contracts; and ¥1,800 bags at smaller retailers,” Koizumi said. “Consumers will have more options to choose from.”
To a question from opposition Constitutional Democratic Party of Japan leader Yoshihiko Noda on whether the government plans to increase the supply of imported rice into the country, Koizumi replied that all options are on the table.
The agriculture ministry under Koizumi’s predecessor, Taku Eto, initially sold stockpiled rice through auctions to distributors. But the method failed to bring down prices — the average price of a 5-kg bag of rice at supermarkets hit a record ¥4,285 in the week through May 18.
“It didn’t hit the stores quick enough,” Koizumi said, referring to the rice sold via auctions. “It didn’t lower the prices like people had hoped for.”
The government stocks up 200,000 tons of rice every year, which are stored for five years before being sold as feed if they are not drawn down in times of emergency, such as natural disasters or extremely poor harvests. This means it has 1 million tons of stockpiled rice in any given year.
So far, 310,000 tons of the rice from the government stockpile have been auctioned off, along with another 300,000 tons sold through no-bid contracts.
Koizumi said his ministry will eventually restore the stockpile to the 1-million-ton mark, though he did not give a specific timeline for this.
Japan consumes about 7 million tons of rice a year, according to the ministry.
To Read more about Rice News continue reading Agriinsite.com
Source : Japan Times
