Govt to Support Rice Farmers Increase Crop Yields

By Haruna Fukushima and Hiroyuki Sato / Yomiuri Shimbun Staff Writers

1:00 JST, August 7, 2025

The government has revised its agricultural policy, shifting to a new strategy aimed at boosting rice production.

Although the policy of capping rice production ended with the rice harvested in 2018, the government has continued to make unofficial attempts to control production volumes.

Since the 2022 harvest, demand has largely exceeded production.

The government concluded that the recent rice price hikes were caused by low production volumes. Therefore, it plans to help rice farmers increase their crop yields through measures to raise productivity and by other means to stabilize prices.

Rice prices remain high

The average retail price of rice in about 1,000 supermarkets nationwide hit ¥4,285 per five kilograms in May, which is double the price from the same period last year, according to the Agriculture, Forestry and Fisheries Ministry.

On Monday, it was announced that the average price had risen for the first time in 10 weeks, reaching ¥3,625 per five kilograms between July 21 and 27. However, Agriculture, Forestry and Fisheries Minister Shinjiro Koizumi commented, “[The prices] have stabilized considerably compared to peak times.”

Last summer, rice prices began to surge after inventories of retailers decreased. At the time, the agriculture ministry said prices would fall and stabilize at appropriate levels once the new harvests began circulating in the market.

However, even after the new harvests entered in the market last autumn, the upward trend in rice prices did not change.

Prices continued to rise even after the start of this year, prompting the agriculture ministry to release government-stockpiled rice.

Koizumi, who became agriculture minister in May, began releasing more government-stockpiled rice sold through no-bid contracts, aiming for a retail price of around ¥2,000 per five kilograms.

Since then, average rice prices have started to fall, but the current prices remain higher than before the price hikes began.

Inaccurate forecast

Experts have pointed to the government inaccurately forecasting rice demand as a possible cause of the price hikes.

The agriculture ministry disclosed in late July that the demand for the 2024 rice harvest as a staple food between July 2024 and June 2025 was 7.11 million tons.

This figure represents an increase of 370,000 tons from the previous forecast in May.

The ministry predicted that the demand for rice would decrease by an average of 100,000 tons per year alongside Japan’s declining population. But the ministry miscalculated other factors, such as increased household purchases amid concerns about rice shortages and increased dining-out demand due to the rise in foreign tourists visiting Japan.

Initially, the ministry assumed the shortage was due to excessive inventories held by retailers and wholesalers.

However, after surveying approximately 70,000 businesses nationwide on rice sales and inventory status, the ministry found that rice collectors, including local agricultural cooperatives of the JA group, as well as retailers and restaurants, had similar inventory levels as of the end of June compared to the previous year.

Drawbacks of production caps

Previously, the government had promoted a policy of reducing rice cultivation by setting production targets and allocating them to prefectures. Although this policy was abolished for the 2018 crop, the government continues to provide a guideline for production based on the demand forecast and subsidies to producers who switch from producing rice for consumers to producing rice for animal feed. The policy that in effect curbed rice production has continued.

This was done to support rice producers and prevent production volumes from being too high, which could lead to a significant drop in prices.

But the ministry’s miscalculation of supply and demand forecasts, diversification of sales channels and the decrease in harvests due to extremely hot weather, among other factors, have adversely affected the rice market.

The current situation has exposed the drawbacks of agricultural policies that prioritize capping rice production volumes.

Going forward, the government aims to increase the productivity of rice farmers through such measures as utilizing advanced digital technologies and expanding the scale of farming operations.

Additionally, there are plans to establish a new system to help farmers in mountainous areas, which are not ideal for agricultural production, to manage their land.

With these measures, the government aims to create an environment in which producers will be motivated to boost rice production.