Japan rice prices plunge amid record surplus and farmer losses

Japan is facing a significant decline in rice prices due to a record surplus. JA Zen-Noh Niigata has set the collection price for Koshihikari rice at 18,500 yen per 60kg, representing a 40% drop from the previous year. This price falls below the estimated production cost of 20,535 yen, raising concerns that farmers may abandon rice cultivation due to financial losses.

The surplus is driven by a combination of factors, including high inventory levels and a shift in consumer behavior. Following a period of extreme price hikes, many consumers transitioned to alternative staples like bread and noodles, or opted for imported rice. This decline in demand, coupled with increased production and delayed government intervention, has led to a massive buildup of stock.

While retail prices for 5kg bags of Koshihikari are expected to drop from around 5,000 yen to approximately 4,000 yen or even lower, the volatility poses a threat to the stability of the agricultural sector. Similar price drops have been reported in Kagoshima and Miyazaki prefectures, suggesting a nationwide trend.