Business reporter

When Japan’s farm minister declared that he by no means had to purchase rice as a result of his supporters give him “plenty” of it as presents, he hoped to attract laughs.
Instead Taku Eto drew outrage – and sufficient of it to pressure him to resign.
Japan is dealing with its first cost-of-living disaster in a long time, which is hitting a beloved staple: rice. The value has greater than doubled within the final yr, and imported varieties are few and much between.
Eto apologised, saying he had gone “too far” along with his feedback on Sunday at an area fundraiser. He resigned after opposition events threatened a no-confidence movement towards him.
His ousting offers a contemporary blow to Prime Minister Shigeru Ishiba’s minority authorities, which was already fighting falling public assist.
Rice is usually a highly effective set off in Japan, the place shortages have triggered political upsets earlier than. Riots over the hovering price of rice even toppled a authorities in 1918.
So it isn’t that shocking that rice costs have a job in Ishiba’s plummeting approval scores.
“Politicians don’t go to supermarkets to do their grocery shopping so they don’t understand,” 31-year-old Memori Higuchi tells the BBC from her residence in Yokohama.
Ms Higuchi is a first-time mom of a seven-month-old. Good meals for her postnatal restoration has been essential, and her daughter will quickly begin consuming strong meals.
“I want her to eat well so if prices keep going up, we may have to reduce the amount of rice my husband and I eat.”
A expensive error?
It’s a easy challenge of provide and demand, agricultural economist Kunio Nishikawa of Ibaraki University says.
But he believes it was attributable to a authorities miscalculation.
Until 1995, the federal government managed the quantity of rice farmers produced by working intently with agricultural cooperatives. The regulation was abolished that yr however the agriculture ministry continues to publish demand estimates so farmers can keep away from producing a glut of rice.
But, Prof Nishikawa says, they received it mistaken in 2023 and 2024. They estimated the demand to be 6.8m tonnes, whereas the precise demand, he provides, was 7.05m tonnes.
Demand for rice went up due to extra vacationers visiting Japan and an increase in folks consuming out after the pandemic.
But precise manufacturing was even decrease than the estimate: 6.61m tonnes, Prof Nishikawa says.
“It is true that the demand for rice jumped, due to several factors – including the fact that rice was relatively affordable compared to other food items and a rise in the number of overseas visitors,” a spokesperson for the agriculture ministry informed the BBC.
“The quality of rice wasn’t great due to unusually high temperatures which also resulted in lower rice production.”
Growing rice is now not worthwhile
Rice farmers have been unable to make sufficient cash for a few years, says 59-year-old Kosuke Kasahara, whose household have been in farming for generations.
He explains that it prices roughly 18,500 yen ($125.70; £94.60) to supply 60kg of rice however the cooperative in his space of Niigata on the west coast of Japan supplied to purchase it final yr at 19,000 yen.
“Until three or four years ago, the government would even offer financial incentives to municipalities that agreed to reduce rice production,” he provides.
The ministry spokesperson confirms that the federal government has supplied subsidies to these selecting to supply wheat or soybeans as a substitute of rice.
Meanwhile, youthful farmers have been selecting to supply various kinds of rice which can be used for sake, rice crackers or fed to livestock as a result of demand for rice in Japan had been falling till final yr.
“I got tired of fighting retailers or restaurants that wanted me to sell rice cheaply for many years,” says Shinya Tabuchi.
But that is been flipped on its head, with the going price for 60kg of rice at present at 40,000 to 50,000 yen.
While larger costs are unhealthy information for customers, it means many struggling farmers will lastly have the ability to earn cash.
But as the general public grew offended with the surge, the federal government auctioned a few of its emergency reserves of rice in March to attempt to convey costs down.
Many nations have strategic reserves – stockpiles of important items – of crude oil or pure fuel to arrange for distinctive circumstances. In Asia, many governments even have stockpiles of rice.
In latest years, Japan’s rice stockpile had solely been tapped within the wake of pure disasters.
“The government has always told us that they would not release its emergency rice stocks to control the price so we felt betrayed,” Mr Tabuchi says.
Despite the federal government’s uncommon choice to launch rice, costs have continued to rise.
Tackling hovering costs
The price of rice can also be hovering in South East Asia, which accounts for nearly 30% of worldwide rice manufacturing – financial, political and local weather pressures have resulted in shortages lately.
In Japan although the difficulty has develop into so critical that the nation has begun importing rice from South Korea for the primary time in 1 / 4 of a century, regardless that shoppers choose homegrown varieties.
PM Ishiba has additionally hinted at increasing imports of US rice as his authorities continues to barter a commerce cope with Washington.
But customers like Ms Higuchi say they’re unlikely to purchase non-Japanese rice.
“We’ve been saying local production for local consumption for a long time,” she says. “There has to be a way for Japanese farmers to be profitable and consumers to feel safe by being able to afford home-grown produce.”
This divides opinion amongst farmers.
“You may hear that the industry is ageing and shrinking but that is not necessarily true,” says Mr Tabuchi, who believes the sector has been too protected by the federal government.
“Many elderly farmers can afford to sell rice cheaply because they have pensions and assets but the younger generation has to be able to make money. Instead of guaranteeing the income of all the farmers and distorting the market, the government should let unprofitable farmers fail.”
Mr Kasahara disagrees: “Farming in rural areas like ours is about being part of a community. If we let those farmers fail, our areas will be in ruins.”
He argues the federal government ought to set a assured shopping for value of 32,000 to 36,000 yen per 60kg of rice which is decrease than at present’s value however nonetheless permits farmers to be worthwhile.
And given what occurred to Eto, additionally it is a delicate matter for politicians.
The nation is because of maintain a key nationwide election this summer season so pleasing each shoppers and farmers – particularly the aged in each camps who are inclined to vote extra – is essential.
https://www.bbc.com/news/articles/cj42vjrdz1no