Japan Grain & Cereals insights

The average retail price of rice in Japanese stores has almost doubled over the year. This is evidenced by the data of the Ministry of Agriculture, Forestry and Fisheries of the country. According to this data, the average market price for 5 kg of rice in the first week of February 2025 reached 3,829 yen

Japanese Minister of Agriculture, Forestry and Fisheries Taku Eto recently expressed his willingness to renegotiate the reduction of mandatory rice imports, saying that it is a task he wants to work on. In response, opinions that Japan should renegotiate the mandatory import volume and those that are cautious are clashing in Korea. At a recent press conference, Minister Eto said, “It is not unreasonable to point out that it is strange that the national (consumption) assumption has changed but the import volume has not changed,” and “(the reduction of mandatory import volume) is a high hurdle, but we will not give up and will challenge it.” The background to Minister Eto’s claim is the rapid decline in rice consumption. After the conclusion of the Uruguay Round (UR) negotiations in 1994, Korea and Japan allowed exporting countries to renegotiate the mandatory import volume, called the minimum market access (MMA), in exchange for postponing the tariffication of rice. Japan imports about 770,000 tons of rice annually, which is 7.23% of the consumption amount (10.65 million tons) from 1986 to 1988. However, according to the ‘Japan Agricultural Newspaper,’ Japan’s rice consumption has recently fallen to 7 million tons per year. 408,700 tons of mandatory import rice are imported into Korea every year. This is equivalent to 7.96% of the consumption amount in the base year (1988 to 1990). Like Japan, Korea’s rice consumption has also been decreasing rapidly, with the average consumption amount reaching 121.1 kg in 1988 to 1990 falling 53.9% to 55.8 kg last year. The burden of digesting mandatory import rice is growing. As Japan pulls out the card of reducing mandatory imports, voices are also being raised in Korea to prepare for renegotiation. A Democratic Party official said, “If Japan officially comes to the table, we can consider various negotiation methods based on Japan’s precedents or show solidarity.” The ‘uselessness of the World Trade Organization (WTO) and free trade agreements (FTAs)’ that has emerged since US President Donald Trump took office also lends support to this proposal. With the conclusion of the Korea-US FTA, Korea was able to export automobiles, steel, etc. tariff-free in exchange for opening its agricultural product market. However, President Trump, based on the US ‘Trade Expansion Act’, imposed a maximum 25% tax on all imported steel products this year, following 2018.

Japan's rice price surge is adding to the burden of living costs, as high demand puts a squeeze on supplies.