Why has Japan been hit with rice shortages despite normal crops?
mainichi.jp
mainichi.jp
A: Exactly. Rice acreage reduction is an absolutely terrible policy. The government spends over 300 billion yen (about $2.06 billion) in subsidies annually to decrease the amount of rice produced, thus going out of its way to raise the price and increasing the burden on consumers.
Some ground isn’t suitable for much else than annual ryegrass, which does well on the clay mud in the hills and seasonal bogs. There’s not much to switch to that can even handle the conditions.
Other grass crops like different types of fescue are a multi year investments since the first year you don’t get much from the field and it takes time to clean up the weed seeds. So flipping to another crop puts you in a big hole.
Finally there’s the generally six figure equipment to harvest any particular crop. A given harvester can only deal with a very limited selection of crops, and even then is often going to require configuration and tuning when switching to a compatible crop.
I think the grape and hop guys might also be seeing something similar, but I’m not entirely sure.
I can imagine that growers with fields configured for growing rice face similar issues. If price tanks, they don’t have the flexibility to “just” pivot to something else as needed.
Japan is also a parliamentary system, and a significant portion of Single Member Seats in the House of Representatives are small towns or rural [0]
Pissed off farmers caused the LDP to lose power in the 2009 election [1], which is historic in a country that is a de facto one-party state.
The LDP in 2024 is looking similarly weak like the LDP in 2009 so they cannot afford to anger the farming bloc.
[0] - https://en.m.wikipedia.org/wiki/List_of_districts_of_the_Hou...
[1] - https://en.m.wikipedia.org/wiki/2009_Japanese_general_electi...
Rice doesn't actually need a lot of water to grow, they use the water as a type of weed control, rice is unique in that it can grow practically submersed in water. Most other species cannot.
Bali has been experimenting growing rice without such large amounts of water, it went well. Google it!
Totally not the point of this, but is Japanese rice really "the best-tasting"? Don't get me wrong, I enjoy California-produced Japanese-style short-grained varieties (I'm not sure whether I've bought actual Japanese-grown rice) -- in some applications. But sometimes you want a jasmine or a basmati or something else, and it seems like that's a matter of preference and what you're used to and what other food you're eating it with, more than "better" or "luxury".
I'm sure it's excellent, but in the end, it's just rice. A blind taste test would be random noise. I sure can't remember there being a material different in the rice I ate in Japan vs good Japanese food in Cali.
Hell, even if you included jasmine or basmati, I'll bet most western people wouldn't even be able to tell those apart from Japanese short-grained rice.
Edit: western people
It was a bit of hyperbole, but I think you'd be surprised how undifferentiated people's pallets can be if they aren't eating something constantly.
I'll beat your blind taste test everyday of the week just by rolling the rice around in my mouth
EDIT fwiw you can vaguely bucket 1.4 billion people into "eat basmati" 673M+1.4B people into "eat jasmine" and 150M+50M into "eat short grain" rice which is well over a third of the planet
I should have qualified that to randomly selected Americans/Europeans. And that they could understand each type of rice is different but wouldn't have a clue which is which.
As a cash strapped student I would buy Korean short grain as it was cheaper
Tell that to my Japanese wife, LOL
We also buy the “Japanese” rice grown in California and she is never fully satisfied with it.
I would be amazed if rice grown by Japanese immigrants like Koda or Tamkai couldn't reach the level and it really was the land that made the difference.
That's aside from whatever harder-to-measure taste differences it might have, but it makes a big difference by itself.
The previous place I lived in had very hard water, and I found that running the water through both a coffee filter and then a Brita charcoal filter worked rather well to soften the water and improve the quality of the rice I was cooking.
The only experiment I have found that attempts to measure this is by Kenji with pizza. In his test, the water did not matter.
https://www.seriouseats.com/does-nyc-water-make-a-difference...
Nishiki uses an offshoot of Calrose rice, which is okay but popular Japanese rice is often Koshihikari or Yumipurika: https://en.wikipedia.org/wiki/Nishiki_rice (do click the link for SICK web art on a random wikipedia page)
If you can find some https://umamimart.com/products/tamaki-haiga-rice is one of my favs.
Or as someone commented below the rice from The Rice Factory is solid if you are looking for a treat: https://trf-ny.com/collections/rice
I currently have 3 varieties from TRF in my cupboard :D
As you say, there are different kinds of rice that taste and feel differently, and you should use the right one for your recipe, but debating with a marketing person about their superlative is a futile exercise.
Surely this would be better served with a believable statement rather than blatantly subjective hyperbole.
meet Lexus LFA vs Corvette.
Though if we're talking specifically about heavy metals, iirc northeastern China has better (lower) heavy metal levels compared to a lot of other parts of China
There is an old Chinese saying that goes Live in Hangzhou, marry in Suzhou, dine in Guangzhou, and die in Luzhou.
But my wife is from way northeast, and I had to begrudgingly admit that I do like the rice from up there better.
The premium brands of Japanese rice that I would buy were slightly better than the current Kokuho Rose brand I get now (this is the best I can find in semi-rural Canada). The biggest difference in quality were brown rice variants (e.g. genmai) that I have been unable to find anywhere else. But the short-grain white rice weren't so much better that I really miss them. The quality is maybe 5% better but the cost to have it imported here is more than double, so very much not worth it.
Does that mean that each acre is producing about 100% of the average production, or that the total production is about 100% of the average production?
The article makes it sound like the change in production is neglectable and that the change in demand is tiny, implying that a high estimate would be about 0.5% increase in demand.
Plenty of countries have subsidised or even free food programmes. (EDIT: Nvm, missed “to developing countries.”)
And you suggest that they deplete this non-renewable resource faster ?
Strategically/rarely buying and dumping excessively cheap grain would bolster farmers' livelihoods, prevent price collapse, and... some fish get fed one time.
You solve permanent overproduction with mobbing people together and demanding that the government stops mandating it. Because it only exists when the government mandates it.
If you want to soften the blow into people that have to learn how to grow some completely different crop. You go and do that, you don't create an entire class entitled to permanent societal support for not working.
You don’t want the global markets determining that you have a competitive disadvantage relative to peers and thus want to import all of your food and abandon your domestic production.
You also don’t want farmers hitting the prisoners dilemma issue of producing as much crop as possible because then farms die from competition. And again letting them die is not good for a critical industry like food.
Paying farmers to underutilize their land is a less insane idea than it sounds.
With what money?
Japan already has some of the highest debt-to-GDP ratios in the world, the Yen is increasingly unstable, and much of the budget is spent on the Japanese Welfare system that cannot be messed with or you are committing political suicide along with rising defense expenditures that are now required due to North Korea's military buildup.
The existing status quo is good enough to keep farmers happy (and not switching their vote) while leaving money on the table to be used for social spending, defense, and debt payments.
Japan has very low wages compared to other OECD countries (the average wage in Japan is only around $25,000), so inflation - especially the kind you are proposing - is catastrophic, especially given how a significant proportion of the population is on a fixed income due to retirement or social subsidizes due to un- or underemployment.
This is why the Japanese government tries to limit inflation to 2%.
> because Japanese prices have barely nudged since 1990
Because of significant government intervention.
Interest rates have been negative for nearly 2 decades. What significant government intervention has there been to keep inflation low?
Personally I don't know why they didn't just raise the minimum wage.
Nope.
Only since 2015 when the Japanese economy entered a recession and CPI rose to 4%.
> What significant government intervention has there been to keep inflation low
Negative inflation rates, impacting the ability to borrow further.
The expansive welfare system that allows 2% of the poorest Japanese to get direct benefits transfers (it's a great program, but very expensive, so other priorities are lower).
Price controls on utilities and some crops like Wheat.
> I don't know why they didn't just raise the minimum wage
Because Japan has a very extensive set of FTAs, and before 2015 a very high youth unemployment rate (8-12%).
If Japan raised the minimum wage, employers would leave for South Korea, Taiwan, China, ASEAN, and India.
https://www.cnn.com/2024/03/18/business/japan-boj-negative-i...
First rate hike in 17 years this year.
> Negative inflation rates, impacting the ability to borrow further.
Government doesn't set the inflation rate.
> The expansive welfare system that allows 2% of the poorest Japanese to get direct benefits transfers (it's a great program, but very expensive, so other priorities are lower). Price controls on utilities and some crops like Wheat.
Those would lead to higher inflation, not lower.
That does NOT mean interest rates were negative.
Negative interest rates were only applied in 2015 [0]
> Government doesn't set the inflation rate.
Typo. I meant interest rates.
You're being pedantic. Your graph shows interest rates have been essentially under 0.5 for 30 years. At no point is that a hammer being used to curtail inflation, which was the point.
Wages increase with government spending (and inflation), unless productivity falls a lot or there's a huge wealth transfer from labor to capital. When the government prints a bunch of money and uses it to purchase a bunch of rice from Japanese farmers, that money ends up as higher wages for farmers and their supply chain, and this in turn circulates throughout the economy, as one farmer's spending is another retail worker's wages.
This doesn't help retirees of course, who aren't earning any more, but the government can choose to hand them more money too if necessary; inflation-indexed pensions are a policy choice. (Although I would say that they should be handing more money to young children, in the custody of their parents).
With what money?
Not as much as if they were subsidizing the cost directly.
In this case the loss is on the consumer's end.
The Japanese Budget for FY24 and FY25 was made before the sudden appreciation of the Yen suddenly made a number of calculations moot.
Welcome to policy dependency hell.. its getting heated.. but gradually..
I recommend little mom-and-pop stores. Typically they feel free to quietly charge a market-clearing price.
That's not true due to Always Late Inventory(tm). See: Covid and toilet paper in the US.
Because inventory is optimized to almost nothing, a demand shock can strip the shelves (the last remaining point of inventory) before pricing can adjust. Super-optimization means that supply has very little ability to increase and it would take many months to backfill the drained edge inventory. Prices shoot up, but don't actually make a dent as there is enough inelastic demand to always drain the incremental inventory resupply.
Add in the fact that a harvest is a specific point in time while consumption is continuous and it's really easy to wind up in a shortage situation that takes a remarkably long time to correct.
Does Japan not have that?
"Japan's rice stockpile has dropped to its lowest level in this century due to a prolonged heatwave in 2023 and rising domestic demand, causing concerns among residents about high prices."
Though if you have diversity in your crop production, usually when one thing does badly, something else does better, especially if your country is big.
When COVID first hit, I did an estimate of how much food I had on hand (without even intentionally trying to stockpile) and I figure I could live 6-8 months without leaving.
https://www.newsweek.com/americas-14-billion-pound-cheese-st...
(From a few quick searches, it looks like rice will last 5+ years with proper storage.)
They claim to have enough.
Japan is only producing about half of the rice it could potentially produce.
This is due to government policy that pays farmers not to grow to prevent falling prices.
Argues in the current geopolitical climate with the potential of a food blockade, this policy should be abandoned.
If abandoned, Japan will become one of the largest rice exporters which he argues is better for Japanese food security.[1] https://en.wikipedia.org/wiki/File:Agricultural_output_Japan...
Large economic systems in real life have economic niches. Government policy levers change the basic flow patterns.. it is often a matter of life and death
Their Debt-to-GDP ratio is 263% (so around $9 trillion in debt), and the government's budget is only $1.2 trillion per year, so it becomes very difficult to maneuver, especially due to the increased Yen volatility.
The current status quo keeps farmers happy and voting for the LDP, while continuing to fund Japan's very generous and very expensive welfare system that everyone loves.
Mainichi is also the opposition newspaper and election season is approaching in Japan due to Kishida's scandals leading to his resignation.
Result: high prices (basically a regressive tax), personal import limits that haven’t increased in 3+ decades, artificial barriers to entry (good luck becoming a dairy farmer unless you inherited a farm or take out a massive loan before even starting) & low per capita production for a country that could be a dairy exporting juggernaut.
New Zealand is currently the biggest dairy exporter. Canada, despite being a massive agri-exporter for other products, not even in the top 15.
You can price your menu high, such that it's mostly empty but sustainable.
The other option is pricing things low, and having the tables always be full. But of course, the employees need to work more.
The Japanese government has long managed the production of rice to keep market prices high for the farmers' sake and given subsidies to farmers to not fully utilize their production potential.
Covid hit and tanked the demand moreso than usual, so government policies shifted to further production (read: supply) reductions. Less supply in response to reduced demand equals maintained market prices.
Politics has not caught up in the post-covid era where demand from both domestic and international (including tourism) has recovered and surged. The supply is still mid-covid limited.
Why? Politics. Fin.
That's not really in your interest, either.
The free market people will say - oh, someone else will just come in and take over the farm.
Easier said than done.
I'm not saying Japan has the best system, but it's probably nowhere near as bad as you think.
I merely answered the Why? in the clickbaity article title.
As far as my thoughts on the policy, I think it's quite more reasonable than the far more popular western policy of letting the free market kill itself in a race to the bottom only to then be bought out by China.
The current rice shortage isn't a problem to do with the policy, it's how it's being handled.
They care about the people who have been getting those billions for decades spending a small portion of it against them. Also they are concerned for their family members who happen to be upstanding people who landed in great jobs at charities owned by the people who get the billions to not feed people.
High prices? 2022 is but a distant memory now. As a farmer, I haven't seen food prices this low, nominally, since the bottom of the mid-2010s crash, and if you account for inflation it doesn't look like food has ever been as cheap as it is right now!
Perhaps you mean the current high price of convenience? It does seem the grocery stores keep pushing prices higher even as the price of food keeps going down, down, down.
>Never complain about how farming is managed and paid for when your belly is full.
But then in the next section says it's because demand outstrips supply because of things like tourism.
What?
This is a piece of political writing targeted at the Japanese land use and subsidy policy. Nothing more.
Their system of subsidies limits the production of rice, so they do not have any rice surplus.
Because of that, even a very small increase in rice demand, like from having more tourists than expected in 2024 (I have also visited Japan this year, benefiting from the small prices after yen conversion) has been enough so that the demand could not be satisfied, resulting in increased prices.
After tasting the Japanese rice in Japan, I agree with the article that their rice is by far the best and that the government policy of limiting the rice production is wrong and it would be much better for them to produce a rice surplus and attempt to export it.
As they are aware, they could not compete directly with the cheaper rice from Thailand or other major exporters, but they could compete successfully in the "more expensive but better" rice category.
It seems a common phenomenon around the world that, because price instability for food leads to social instability, governments end up with elaborate systems of direct and indirect price control. In this case, farmers being paid not to grow rice.
Not that rice would do anything so nefarious, but more to point out that large scale purchase and storage is not a trivial task. I can imagine the scenario where some bureaucrats ran the numbers and concluded that it is cheaper to just give the money to farmers instead of running the purchase/storage scheme.
The problem is, the other option here, the Futures Markets has Goldman-Sachs using their vast cash reserves to buy in when it suits them so as to make money on the people's daily bread.
Like many other things, "It's better to have it and not need it, than need it, and not have it."
Edit: Article also says "western" countries subsidize farmers to protect them from price drops of oversupply.