TOKYO, Oct 20 (News On Japan) –
The wholesale worth of rice traded between companies is anticipated to achieve an unprecedented degree of over 36,000 yen per 60 kilograms regardless of a bumper harvest this 12 months, based on interviews performed by JNN, highlighting the extreme competitors amongst patrons and the distorted dynamics of Japan’s rice market.
As rice harvesting entered its closing levels in October, producers like Koike Farm in Chiba had been relieved to see yields return to regular after final 12 months’s poor harvest. “Last year, our yield was nearly cut in half, but by thoroughly controlling pests and diseases this season, we managed to achieve an average harvest,” mentioned proprietor Takashi Koike. The Ministry of Agriculture, Forestry and Fisheries initiatives that complete rice manufacturing this 12 months will enhance by greater than 680,000 tons in contrast with final 12 months.
Despite the upper provide, nevertheless, the typical inter-company transaction worth — generally known as the “relative transaction price” — for September is anticipated to be within the higher 36,000-yen vary per 60 kilograms, roughly 14,000 yen increased than the identical interval final 12 months and the best on file. The information exhibits that buying and selling for new-season rice has overheated and that costs are prone to stay elevated within the months forward.
At a rice store in Chiba, piles of unsold rice sit in storage regardless of the ample harvest. “New rice isn’t selling. It’s too expensive,” mentioned the store’s president. “Cheaper rice sells first, so everyone in the industry uses that up. The expensive stuff just sits here.” The surge in costs has been fueled by a fierce “collection battle” — competitors amongst patrons to safe stock amid fears of one other scarcity like final 12 months’s.
Private patrons revealed that they’re spending roughly double their common quantities to safe rice. “It’s nerve-wracking. We’re buying at much higher prices than usual,” one wholesaler mentioned. Their important rivals are Japan Agricultural Cooperatives (JA), which has considerably elevated the “advance payment” it presents farmers to safe provide. In response, non-public patrons have provided even increased costs to keep away from dropping out, prompting JA to boost its fee once more and driving costs even increased.
The intense bidding now entails non-public collectors, JA, and even normal shoppers, making a market the place no aspect advantages. “We’re seen as the bad guys, but we’re taking big risks,” mentioned a personal purchaser. “If we lower our purchasing price, we can’t buy anything. If we raise it, we can’t sell. It’s a dilemma.”
Even with the brand new rice collected at inflated costs, sellers are reluctant to chop costs for worry of monetary break. “There’s a limit to how much loss we can absorb,” the rice store president defined. “If we slash prices too much, we’ll go under.” Some business observers predict that if rice leads to surplus as a result of ample harvest, costs may ultimately fall by spring. But uncertainty looms. “Nobody knows when the price might crash,” the store president mentioned. “It’s like gambling.”
Producers, wholesalers, retailers, and shoppers alike are caught in a vicious cycle of rising costs that advantages nobody. Many are actually calling for pressing, complete measures to stabilize Japan’s rice market earlier than the scenario worsens.
Source: TBS