A Bowl of Rice Taken Away by Inbound Tourism and Extreme Heat: Understanding the "Rice Shortage" Through Data

1. What's Happening —— The Current State of the "Rice Shortage"

• The growth of +98.4% year-on-year (April 2025) is an outstanding increase rate among Japan's consumer prices. Al Jazeera

• At supermarkets, 5 kg is priced between 4,200 to 5,000 yen as a norm. Even the government's price monitors hear voices saying, "Rice is exceptional." TV Asahi News

2. Background① Abnormal Weather and Crop Deterioration

• The record-breaking heat in the summer of 2023 caused widespread poor grain filling, resulting in a supply gap of about 300,000 tons. Even restaurant chains avoided low-quality rice, accelerating the scramble for high-quality rice. MRI Co., Ltd.

• In production areas, there were frequent downgrades of brown rice, with some prefectures in the Tohoku region seeing the ratio of non-standard rice reach three times the average.

3. Background② "Unexpected" Demand Side

Summary of Demand Increase Factors Recovery of Inbound Tourism In 2024, the number of visitors to Japan exceeded pre-COVID levels, leading to a rapid recovery in rice demand in hotels and restaurants. The Japan Tourism Agency reports continued additional procurement of rice and rice products. Ministry of Land, Infrastructure, Transport and Tourism Disaster Stockpiling After the Noto Peninsula Earthquake (January 2024), household stockpiling demand for rice increased further. "Cheaper Overseas" Reversal Phenomenon Japanese rice contracted at old prices was sold in Taipei and London at <5 kg 2,600 yen>, further squeezing domestic supply. TV Asahi News

4. Background③ Distortions in Systems and Distribution

1. "Voluntary Production Adjustment" Continues After the Abolition of Rice Acreage Reduction The swing back of "crop conversion → re-conversion" occurs against the backdrop of rice acreage reduction subsidies, causing fluctuations in planted area each year. note (Note)

2. Stock Exists but Doesn't Reach Storefronts Multi-layered distribution creates a "stock barrier." The government's March auction of 210,000 tons had a retail arrival rate of only 7%. Reuters

3. High Tariffs and SBS Imports Tariffs outside the WTO quota are 341 yen/kg. Ironically, exports are increasing to CPTPP regions (like the UK) where tariffs are lower. TV Asahi News

5. Government's Emergency Measures

Policy Content Evaluation Release of 300,000 tons of stockpiled rice at 2,000 yen/5kg Targeting "half price" of the store average, to be delivered by early June. Logistics is the bottleneck. The first batch saw immediate application suspension → continued shortage. Reuters Suspension of Buyback Traditionally, the amount released = buyback the following year, but this year aims to "not buy back" to calm prices. Welcomed by the market, but producers fear a sharp price drop. Incentives for Production Expansion Support for increasing planting for the 2025 crop within prefectural quotas. In farmer surveys, 40% voice concerns of a "rebound drop" for the 2026 crop.

6. Three Points Overseas Readers Should Understand

1. "Shortage ≠ Absolute Zero Quantity" Domestic stock is on par with the average year, but the lack of "desired grade" is driving up prices.

2. The Tug-of-War Between Food Security and Market Principles Tariffs and stockpiling create a high-cost structure, which is quickly exposed by climate shocks.

3. Japanese Rice Remains "Super High Quality" The quality gap is significant, making simple price comparisons with overseas products inadequate. Japanese restaurants in tourist areas struggle to protect domestic rice.

7. Future Scenarios

• Short-term (FY2025): Even with the release of stockpiled rice easing the situation in summer, the lower price limit is expected to be in the high 4,000 yen range.

• Mid-term (FY2026): Increased planting + import pressure leads to "price decline," with 30-40% of farmer survey results indicating this. There is also a risk of supply-demand reversal. Nippon

• Long-term (Climate Change Risk): The possibility of another "wild fluctuation" with the return of hot years. The challenge is international diversified procurement along with water management and variety improvement.

Conclusion

The surge in Japanese rice prices was triggered not only by a "temporary crop failure" but also by a complex shock involving the revival of tourism, export contracts, and distortions in the distribution system. The government is managing the immediate crisis by releasing stockpiled rice at half price, but unless the structural issue of food security vs. domestic farmer protection is resolved, prices are likely to remain high and fluctuate wildly.

For overseas readers,

• The Brand Value of Japanese Rice and the Vulnerability of the Supply Chain

• The "Price Reversal" Caused by Exchange Rates and Tariffs

• The Destructive Impact of Climate Change on Staple Food Value Chains

――These should serve as a mirror for considering your country's food policy.