Japan may buy more domestic rice to protect prices

posted on October 7, 2015

The Japanese government will buy more rice for its national reserve as part of efforts to prevent domestic rice prices from falling as more of the cheaper, foreign-grown crop enters the market when the Trans-Pacific Partnership takes effect.

The Ministry of Agriculture, Forestry and Fisheries will devise measures as early as this year to ease the trade pact's negative effects on domestic farmers. A task force led by Agriculture Minister Yoshimasa Hayashi will hold its first meeting Friday.

Japan agreed to new tariff-free imports of a combined 56,000 tons of U.S. and Australian rice annually in the initial stage of the TPP, gradually raising this to 78,400 tons in the 13th year of the deal.

Such foreign rice, priced about half that of the domestically grown crop, may prompt some Japanese consumers to ditch homegrown rice. The government also fears the influx of cheaper rice may lower the price of the domestic variety. The price of the benchmark Koshihikari brand grown in Niigata Prefecture has already dropped to about 15,000 yen ($123) per 60kg for the 2014 crop. A further decline would hurt producers.

To prevent supply from growing too slack, the government will buy up domestic rice in the same amount as the newly introduced tariff-free U.S. and Australian rice, keeping it as part of its national reserve of around 1 million tons. The government buys a new batch annually and uses older rice as livestock feed or discards it.

source by newsonjapan
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