Posted originally on Jun 11, 2025 by Martin Armstrong 

The Japanese government announced that it has been forced to release 200,000 metric tons of reserves from its rice stockpile once again, as the nation has been unable to reverse shortages. The government last released over 300,000 metric tons of rice from its emergency reserves, that was intended to last through July, in addition to the 310,000 tons released since March, but this is not sufficient to meet demand, and consumers are highly dissatisfied with the government’s response.

Retailers and local rice sellers with milling capacity will receive the first 100,000 tons of rice from the 2021 harvest. “We want to continue responding without slowing down so that the stockpiled rice can reach consumers quickly and at a low cost,” Agriculture Minister Shinjiro Koizumi said during a press conference. “We must never allow the virtuous cycle of prices and wages in the Japanese economy as a whole to break down. If the cause lies with rice, then I believe we must address such issues promptly.”

Poor weather conditions in 2023 led to a significant decline in crop yields. The Japanese government placed high tariffs on imported rice, and Japanese consumers strongly prefer domestic varieties. Japan reluctantly began importing rice to meet demand. In February alone, Japan imported roughly 40% of what it imported in FY2023. Japan was self-sufficient in rice production, but was forced to purchase rice from South Korea for the first time in 25 years. Japan has also turned to the United States to fill the gap. Panic buying remains prevalent despite the high cost of rice, as it is a staple in the Japanese diet. A mass uptick in tourism following the end of COVID has also been blamed for increased demand, with foreigners increasing by a record 342,000 in 2024.

The Ministry of Internal Affairs and Communications noted that rice prices rose 92.1% year-on-year in March, and despite releasing reserves, prices continued to rise. In mid-April, a 5kg bag of rice reached ¥4,220 (about $29–$30), over an 80% YoY increase. Rice prices hit a record high of ¥4,285 yen ($29.97) for 5kg of rice during the week ending on May 18, with some premium brands like Koshihikari exceeding ¥5,000 yen ($35). As of June 1, the average 5k bag of rice cost about ¥4,223 yen, a 50% annual increase.

This is an extremely serious issue in Japan. The rice crisis controversy is causing the public to lose confidence in the government at large. Prime Minister Shigeru Ishiba’s Administration approval rating sunk to an all-time low of 27.4%. Japanese Minister Taku Etō was forced to resign after stating that he personally has no concern for the rising price of rice. The Upper House election takes place in July, which is certainly unfavorable for the Liberal Democratic Party (LPD) who has been in power since 1955.

The next major rice harvest will be in August. The situation is pessimistic as only 1.458 million hectares were harvested, the lowest on record since at least 1900.

Farmers have been protesting against the government’s policy of rationing harvests. The EU and US allow farmers to produce as much as possible, and the government subsidizes any losses, while Japan has taken an opposite approach. The Japanese government believes it would lose $2.65 billion per year if it were to subsidize harvests, but it is already paying farmers $2.32 billion to ration production. Rice paddies are increasingly abandoned as the next generation has no desire to enter a low-paying industry that they believe has been stifled by government regulation. The Mi/OP: Ministry of Agriculture, Forestry and Fisheries (MAFF) has asked many farmers to focus on rice instead of other crops, but it will take years to replenish the reserves.

Japan has a much more serious issue on its hands as the nation is at risk of an outright default on its outstanding debt. For now, the rice crisis has caused the average person to become disgruntled with the leadership. They say the public is quiet and content when everyone is fat and happy, but now, every meal is a reminder of government mismanagement.