Japan will continue releasing rice from its strategic reserves in an effort
to curb skyrocketing prices, the government announced April 9. The
stockpiles—established nearly 30 years ago to respond to major emergencies such
as natural disasters—are now being deployed to address a market surge not seen
in decades.

Rice prices have been climbing steadily across the country, prompting the
government to take extraordinary measures. Agriculture Minister Taku Eto said
Japan will “release reserves every month through this summer,” when
the next harvest is expected to hit the market.

The situation is without precedent. As of late March, a five-kilogram bag of
rice cost 4,206 yen (around $28), more than double the price from the same time
last year. The spike stems from a combination of factors: a surge in panic
buying triggered by a “megaquake” warning in August 2024 and a supply crunch
following a poor 2023 harvest that was severely impacted by extreme heat.
Authorities have also accused some traders of hoarding rice to sell at peak
prices.

Emergency auctions mark first in decades

Last month, Japan began auctioning rice from its strategic reserves—a first
in 30 years outside of natural disasters or major shortages. According to the agriculture ministry, the government holds about 1 million metric tons of rice in reserve, roughly one-seventh of the nation’s annual consumption. Stored
in around 300 warehouses across the country, the reserves are replenished each
year with 200,000 tons of rice purchased from domestic farmers. The program
costs the government nearly $325 million annually.

The system was established under a 1995 law passed in the wake of a
catastrophic 1993 harvest that led to a historic rice shortage. At the time,
Japanese consumers scrambled to grab the last remaining bags of domestic rice,
forcing the government to import some 2.6 million tons of rice from Australia,
China, the U.S., and Thailand. Much of that was long-grain rice, which is
generally unpopular in Japan, where consumers strongly prefer short-grain
varieties.

Roughly a quarter of the imported rice was never eaten, underscoring the
deep-rooted cultural connection to Japan’s traditional rice, even as per capita
rice consumption has steadily declined—halving between 1962 and 2022.

Still, rice remains a dietary staple, and Japan has turned to its reserves
in the past, most notably following the 2011 Fukushima triple disaster and the
2016 Kumamoto earthquake. Until recently, the government limited the release of
reserves to cases of major crop failure or disaster, fearing a sharp drop in
prices.

Extraordinary measures to stabilize market

Initially, the government had hoped that the autumn 2024 harvest would
stabilize supply. When that didn’t materialize, Tokyo revised its rules on
strategic stock releases to relieve pressure on consumers. In March alone,
about 210,000 tons of rice were released from reserves, with hopes that prices
would begin to drop by late April.

With the distribution network still unable to meet demand, the government is
pressing ahead with monthly releases—at least through July—until the next crop
is ready. The next auction of 100,000 tons of reserve rice is scheduled for
April 21.