TOKYO, Oct 20 (News On Japan) –
The wholesale price of rice traded between businesses is expected to reach an unprecedented level of over 36,000 yen per 60 kilograms despite a bumper harvest this year, according to interviews conducted by JNN, highlighting the intense competition among buyers and the distorted dynamics of Japan’s rice market.
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As rice harvesting entered its final stages in October, producers like Koike Farm in Chiba were relieved to see yields return to normal after last year’s poor harvest. “Last year, our yield was nearly cut in half, but by thoroughly controlling pests and diseases this season, we managed to achieve an average harvest,” said owner Takashi Koike. The Ministry of Agriculture, Forestry and Fisheries projects that total rice production this year will increase by more than 680,000 tons compared with last year.
Despite the higher supply, however, the average inter-company transaction price — known as the “relative transaction price” — for September is expected to be in the upper 36,000-yen range per 60 kilograms, roughly 14,000 yen higher than the same period last year and the highest on record. The data shows that trading for new-season rice has overheated and that prices are likely to remain elevated in the months ahead.
At a rice shop in Chiba, piles of unsold rice sit in storage despite the abundant harvest. “New rice isn’t selling. It’s too expensive,” said the shop’s president. “Cheaper rice sells first, so everyone in the industry uses that up. The expensive stuff just sits here.” The surge in prices has been fueled by a fierce “collection battle” — competition among buyers to secure stock amid fears of another shortage like last year’s.
Private buyers revealed that they are spending roughly double their usual amounts to secure rice. “It’s nerve-wracking. We’re buying at much higher prices than usual,” one wholesaler said. Their main rivals are Japan Agricultural Cooperatives (JA), which has significantly increased the “advance payment” it offers farmers to secure supply. In response, private buyers have offered even higher prices to avoid losing out, prompting JA to raise its payment again and driving prices even higher.
The intense bidding now involves private collectors, JA, and even general consumers, creating a market where no side benefits. “We’re seen as the bad guys, but we’re taking big risks,” said a private buyer. “If we lower our purchasing price, we can’t buy anything. If we raise it, we can’t sell. It’s a dilemma.”
Even with the new rice collected at inflated prices, sellers are reluctant to cut prices for fear of financial ruin. “There’s a limit to how much loss we can absorb,” the rice shop president explained. “If we slash prices too much, we’ll go under.” Some industry observers predict that if rice ends up in surplus due to the abundant harvest, prices could eventually fall by spring. But uncertainty looms. “Nobody knows when the price might crash,” the shop president said. “It’s like gambling.”
Producers, wholesalers, retailers, and consumers alike are caught in a vicious cycle of rising prices that benefits no one. Many are now calling for urgent, comprehensive measures to stabilize Japan’s rice market before the situation worsens.
Source: TBS
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: newsonjapan.com
