Rice crisis: Japan releases strategic reserves to ease prices of nation’s most important food

By Chris Lau, Junko Ogura, Mai Takiguchi and Minori Konishi, CNN

Tokyo (CNN) — It’s eaten with almost every meal, used to make sushi, made into sweets, fermented into alcohol and offered to the spirits at religious ceremonies.

Rice is everywhere in the diet of Japan – there are at least six ways in Japanese to describe the grain, from unhusked to ready to eat. It’s so popular that McDonald’s there added a burger bun made of rice to its menu.

But being so reliant on the staple leaves the country – the world’s fourth-biggest economy – vulnerable to the slightest supply glitch.

In recent years, a combination of bad weather, heatwaves and the threats of typhoons and earthquakes have sparked bouts of panic-buying in the nation of 124 million people.

The average price of a 60-kilogram bag rose to around $160 last year – up 55 per cent compared to two years ago, according to government figures.

The situation has become so dire that the government announced in February that it would release 210,000 tons of rice – more than a fifth of what it holds in its contingency reserve – for auction. The first bags of the reserve rice have now gone on sale in supermarkets.

The government built its rice reserve in 1995, two years after an unexpected cool summer crippled rice harvests forcing it to import overseas grains.

It dipped into the store following the 2011 earthquake and tsunami in which 20,000 people died or went missing, and again following the deadly Kumamoto earthquake in 2016.

Other countries across Asia where rice is a staple, such as India, Vietnam and Thailand also hold rice stockpiles to shield their populations against shortages and price rises – which can spill into politics, like a recent surge in egg prices in the United States.

China also has a strategic reserve of the country’s favorite meat, pork, to deal with emergencies and stabilize prices when necessary.

In Japan, the first batch of 150,000 tons of rice went under the hammer last month, according to the Ministry of Agriculture, Forestry and Fisheries.

“Prices now are exceptionally high,” Agriculture, Forestry and Fisheries Minister Taku Eto said ahead of the auction.

“But I urge everyone not to worry,” he added, saying that he expected the injection of rice into the market would mean prices “eventually come down.”

Eto also attributed the recent price hikes to a supply chain issue, saying that there was sufficient rice in the system, only that it has failed to reach the shelves in supermarkets, without specifying why.

On Wednesday, Trial Holdings, which runs a chain of discounted supermarkets in the southern island of Kyushu, confirmed to CNN that the first batch of auctioned rice has hit the shelves at some of their stores.

But, in a country that is particular about its rice – with various prefectures competing against one another for the title of best rice in the country – some said they would rather sit this batch out, skeptical of the grain’s quality.

“I do not intend to buy it because I have heard that it is old rice. I am still very particular about rice,” housewife Emi Uchibori, 69, told CNN.

Uchibori said she stocked up on supplies in early March after reading about prices going up and hoped what she had would last until prices ease.

“But it doesn’t look like it will go back to its original price,” she said.

Yuko Takiguchi, 53, a part time worker, said she would pass on the auctioned rice unless it became significantly cheaper.

She said she wouldn’t mind forking out more for quality rice as the price of flour had also gone up, driving up costs for other staples such as bread, udon and pasta.

“I prefer rice as a staple food since it is more filling. Also, since I have school-age children, rice is essential for their lunch boxes,” she said.

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