When a extreme rice scarcity despatched costs skyrocketing in Japan final yr, Tokyo restaurant proprietor Arata Hirano did what had as soon as appeared unthinkable: he switched to an American selection.
The value of the Californian Calrose rice he buys has doubled since his first buy final summer time, besides it is cheaper than home-grown grains.
“Unless domestic prices fall below Calrose prices, I don’t plan to switch back,” stated Hirano, whose restaurant affords meal units of fish, rice, soup and sides.
Arata Hirano pours California-grown Calrose rice right into a rice cooker at his restaurant in Tokyo. Image: REUTERS/Kim Kyung-Hoon
His willingness to embrace overseas rice might presage a seismic change in mindset for Japanese companies and shoppers – one that would enable Tokyo leeway to calm down some restrictions if rice turns into a thorny subject in tariff talks with U.S. President Donald Trump, who has known as out Japan’s excessive levies on its staple grain.
Wholesale costs for home rice have surged about 70% over the previous yr to hit their highest ranges since present data started in 2006. Crops had been hit by excessive warmth whereas a tourism increase has added to demand. Worries abound that not a lot will change this yr.
With inflation additionally elevating the price of residing, companies are actually betting {that a} nation of individuals recognized for his or her discerning palates and pleasure of their staple grain is open to alter.
Supermarket large Aeon final week started promoting an 80-20 American-Japanese mix that is about 10% cheaper than home rice after a check sales-run proved successful. Fast-food chain Matsuya and restaurant operator Colowide started serving pure American rice this yr. At grocery store chain Seiyu, Taiwanese rice has been flying off the cabinets since final yr.
It’s a pointy distinction to 1993, when the Thai rice the Japanese authorities imported throughout an acute scarcity was largely shunned, leaving supermarkets with piles of unsold baggage.
Rare shortages apart, for a lot of the previous six many years, almost all of Japan’s so-called staple rice – which is consumed at meals versus rice used for feed or elements in different merchandise – has been home-grown. There hasn’t been a lot want for imports whereas excessive tariffs, put in place to make sure Japanese self-sufficiency for its most elementary meals, have protected native farmers from competitors.
Japan limits tariff-free “minimum access” imports of staple rice to 100,000 metric tons a yr, or round 1% of whole consumption. The U.S. accounted for roughly 60% of that quantity final fiscal yr, trailed by Australia, Thailand and Taiwan. Anything above that’s topic to a levy of 341 yen per kilogram.
When Trump introduced sweeping tariffs on a lot of the world this month, he lambasted Japan for what he stated was a 700% tariff on rice, a reference to that levy. Japanese policymakers known as his remarks on the delicate subject “regrettable”. They additionally dispute the 700% determine, saying it is primarily based on outdated worldwide rice costs.
It’s unclear, nevertheless, simply how a lot – if in any respect – rice will probably be mentioned in bilateral tariff negotiations that started this week. Some analysts assume Trump’s Republican administration won’t be targeted on rice as exports to Japan come from California, a Democratic-leaning state. Nor is it clear how a lot Japan is likely to be keen to yield in opening up its rice market.
In one signal that there is likely to be room for some change, a panel advising the finance ministry on Tuesday proposed increasing imports of staple rice, saying that lifting the 100,000-ton tariff-free cap might assist stabilize provide.
That stated, Prime Minister Shigeru Ishiba’s Liberal Democratic Party is unlikely to danger angering farmers, historically a robust help base, forward of higher home elections in July.
“It’s not possible to make big concessions on rice just before the elections,” stated Junichi Sugawara, senior fellow at Tokyo-based Owls Consulting Group.
MORE IMPORTS TO COME
What is obvious is that offer stays a problem.
In the monetary yr that led to March, tariff-free imports of staple rice hit Japan’s 100,000-ton cap for the primary time in seven years.
The quantity of tariffed imports, whereas nonetheless tiny, additionally jumped, quadrupling within the first 11 months of fiscal 2024 to only beneath 1,500 tons.
And this yr, rice importer Kanematsu is transport in its first large-scale buy of American staple rice, 10,000 tons value.
“We’re receiving many enquiries from the restaurant industry, convenience stores, supermarkets and rice wholesalers,” a Kanematsu spokesperson stated.
In the week to April 6, Japanese grocery store rice costs hit a median of 4,214 yen ($29.65) per 5 kg, marking their 14th straight week of enhance and greater than double the identical interval a yr earlier. That’s regardless of a uncommon launch of rice from the federal government’s emergency stockpiles that began final month and is about to proceed each month by way of July.
As for the standard and style of imported rice, Miki Nihei, a buyer at Hirano’s restaurant, Shokudou Arata, stated she had no complaints and was shocked to study it wasn’t Japanese.
“I had no idea,” she stated. “I have no qualms about eating imported rice. Prices have gone up, so I’m always looking for cheaper options.”
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