Cultivating Change in Japan's Agricultural Policy

In light of increasing international political instability, the amendment made food security in Japan its core focus. Disruptions such as the Russia–Ukraine war have had a major impact on global food security, creating uncertainties about grain supplies and limiting access to critical resources and driving up agricultural input prices. Japan—heavily dependent on food and farming imports—is not immune to the crisis.

Japan’s agricultural industry faces unprecedented challenges. The number of farmers in Japan is falling by 50,000 a year and their average age exceeds 65 years. The Ministry of Agriculture, Forestry and Fisheries (MAFF) has problematised Japan’s low food self-sufficiency rate. In the 2023 financial year, this rate was 38 per cent on a calorie basis and 61 per cent on a production value basis—almost the lowest since 1965.

The amendment aims to adapt the country’s agricultural policy to these domestic and international challenges. It covers important agendas like establishing an environmentally friendly food production system, promoting food exports and setting fair, sustainable prices for farmers.

But the amendment does not change the core focus of Japan’s current agricultural policy, which remains on small and micro family farms that integrate agricultural production with daily life.

Several articles in the amendment symbolise this premise. Article 4 of the amendment emphasises agriculture’s role in creating healthy landscapes and preserving culture. Article 6 asserts the importance of maintaining rural communities through agriculture.

Agricultural policy should provide appropriate support for farmers, but the industry has changed drastically since the dawn of the Basic Law. Family farming has diminished its role in the industry and corporate farms have scaled up production. Japan’s agricultural production base has been significantly weakened. The Basic Law amendment needed to address these changes, but was instead limited to superficial revision.

Japan’s family-oriented agricultural policy has been strongly maintained throughout the post-war period. Tracking its trajectory provides insight into why and how the policy needs to be revised to secure the future of an industry in crisis.

Following the Second World War, Japan established an agricultural policy prioritising domestic production to overcome severe food shortages. This was partly due to Japan’s prolonged wartime conscription, which reduced the agricultural labour force. Japan’s rice production fell by 30 per cent from the previous year to 6 million tonnes in 1945, following apoor harvest. These issues were compounded by Japan’s growing post-war consumption.

The Japanese government implemented an agricultural land reform to increase the number of land-owning farmers. The aim was to reduce the economic gap between landowners and tenant farmers and to increase food production.

The attempt to transform tenant farmers into land-owning farmers dates back to the pre-war period. In 1926, the government introduced a low-interest loan scheme to help tenant farmers purchase farmland without big capital. While the 25-year scheme was initially unpopular, it brought the principle of land ownership in Japanese agricultural policy.

The post-war land reform overturned the pre-war system of land ownership by capping the amount of farmland that could be owned by individuals. The government confiscated nearly 2 million hectares—almost 80 per cent of tenanted farmlands—and redistributed it to tenant farmers.

The number of land-owning farmers in Japan more than doubled thanks to the reform, from 1.5 million households in 1941 to 3.6 million households in 1950. This land reform established the post-war agricultural production system characterised by small and micro family farms.

Thanks to the reform, agricultural production recovered significantly, resolving food shortages. To further improve farmers’ socioeconomic status and agricultural productivity, the government promulgated the Agricultural Basic Act in 1961. It was the first and latest comprehensive agricultural policy in Japan until it was replaced by the Basic Law on Food, Agriculture and Rural Areas in 1999.

A core vision of the Agricultural Basic Act was that land-owning farmers were the foundation of the country’s social stability. In 1960, Japan’s farming population was 34.4 million, or 36.9 per cent of the total population, with the vast majority engaged in small and micro family farming. Improving their livelihoods was to improve the livelihoods of the citizens.

The Basic Act formed the basis of Japan’s post-war agricultural policy, addressing many agendas that still remain today. They include increasing agricultural productivity by producing high-value crops, stabilising agricultural prices, expanding farmlands and, most importantly, protecting small and micro farmers.

The decades following these reforms saw a stagnation of Japan’s agricultural structure of small and micro family farming. At the same time, the proportion of part-time farmers with side jobs increased, resulting in a significant decline in full-time family farmers.

From 1955 to 1973, Japan experienced a period of high economic growth with an annual economic growth rate of nearly 10 per cent. The high economic growth period expanded the non-agricultural labour marketand drastically reduced the agricultural population. The number of farm households in Japan, which peaked at 6 million in 1950, fell to 4.6 million by 1980.

The high economic growth period not only caused the farming population outflowbut alsosignificantly increased the number of part-time farmers. Part-time farm households accounted for 50 per cent (3.1 million) of all farm households in 1950, but by 1980 this had risen to 87 per cent (4 million).

In 1941, MAFF divided part-time farm households into two categories. The first category being ‘farm household earned main income from farming’ and the second being ‘farm household earned main income from other jobs’. They were distinguished by a simple evaluation of each household’s primary source of income.

The second category grew rapidly, with the number of these households increasing from 1.3 million (22 per cent of all farm households) in 1950 to 3 million (65 per cent) in 1980. Farm households began to rely on other income sources during the high economic growth period.

This change was partly because of labour-saving mechanisation in the industry. Labour hours in rice cultivation per 10 acres decreased from 141 hours in 1965 to 29 hours in 2005. The reduction was mainly in planting and harvesting due to the spread of rice planters and combined tractors.

Another side effect of the expansion of the part-time farmers was the large-scale conversion of farmland. The Cropland Act of 1952 restricted the ownership of farmland by non-farmers to secure the production base of farmers. But many farmers started considering land as a private asset with low property taxes and left their farmlands idle or converted them into non-farmland. Conversion increased during the high economic growth period and peaked at 68,000 hectares in 1973, preventing farmland from being scaled up.

At the same time, Japan’s agricultural industry also faced the pressures of globalisation, and the government signed the General Agreement on Tariffs and Trade (GATT) in 1955. While Japan drew a sharp line between low- and high-tariff products, strong pressure from countries such as the United States led to the gradual liberalisation of food imports. This included chicken and soybeans in 1956, pork and compound feed in 1974 and cheese and fruit juice in 1988. The GATT Uruguay Round in 1993 required Japan to set a ‘minimum access’ import quota on rice, challenging the government’s market protection measures. Cheap imported food items have had a severe impact on domestic production.

Most Japanese farming enterprises now have an annual turnover that is lower than the average office worker’s salary. MAFF’s 2020 census revealed that the turnover of 0.8 million (70 per cent) farming enterprises in Japan was below 3 million yen (US$20,465). In 2022, the average turnover of rice farmers was 3.5 million yen (US$23,876).

In Japan, farming enterprises mainly comprise family and corporate farms. Family farming still accounts for over 90 per cent of total farming enterprises. But Japan’s farming population has been declining, accounting for just 1.1 per cent (1.36 million) of the total population in 2020. While family farming remains a dominant form of agriculture in Japan, it is no longer the social foundation of the country.

In 2020, MAFF established the Basic Plan for Food, Agriculture and Rural Areas, an action plan based on the Basic Law on Food, Agriculture and Rural Areas. It aims to raise Japan’s food self-sufficiency rate to 53 per cent on a calorie basis and 79 per cent on a production value basis by 2030. To achieve this goal, the basic plan emphasises strengthening Japan’s domestic agricultural production base.

Japan’s self-sufficiency rate is low compared to countries like the United States (104 per cent on a calorie basis in 2021), Canada (204 per cent) and France (121 per cent). The rate is especially low in crops like soybeans (25 per cent on a calorie basis in 2022) and wheat (16 per cent).

But discussion about food self-sufficiency rates easily becomes a numbers game, where the assumption is that a higher rate is always better. This approach obscures the extent to which Japan’s agricultural production base has actually declined.

The total area of farmland in Japan has decreased by 5 per cent over the past decade. In 2023, Japan had over 0.25 million hectares of abandoned farmlands. The farming population is decreasing drastically, and farmers are aging rapidly. In 2022, 45,840 new farmers entered the industry, but only 16,870 (37 per cent) of them were under the age of 49.

In addition, Japan depends on imports of essential agricultural inputs. For chemical fertilisers, imports come from a few countries— 84 per cent of nitrogen comes from China and Malaysia, 90 per cent of phosphorus comes from China and 59 per cent of potassium comes from Canada. Domestic fertiliser prices have recently soared due to global instability.

Resources for agricultural production in Japan are limited. If increasing food self-sufficiency is a priority, MAFF should focus on specific food products, actors and geographical areas to achieve this goal. But MAFF has not presented a clear strategy on the issue and has chosen to spread wide and shallow support to farmers.

The problem with Japan’s family-oriented agricultural policy is not its support for family farming, but that its support is ad hoc and driven by short-term goals rather than a long-term view of the industry. This lack of coherence has persisted, including in the 2024 amendment to the Basic Law on Food, Agriculture and Rural Areas.

For example, the introduction of advanced technologies aims to increase agricultural productivity. But innovations such as information technologies and new crop varieties are not a cure-all. Large-scale enterprises can adapt to them relatively easily, but small and micro farmers often have limited skills, capacity and financial resources. The government must clarify its target audience and prioritise specific technologies to ensure effective implementation.

From a practical viewpoint, family farming alone cannot sustain the agricultural industry. While family farming still dominates in numbers, corporate farms are becoming increasingly common. Corporate farms that hire employed workers have gained popularity, especially among younger farmers. In 2022, of the 16,870 new farmers under 49 years, employed workers (7,710) outnumbered self-employed farmers (6,500).

Corporate farms are generally much larger than family farms. According to the MAFF’s 2020 census, only 8 per cent (84,939 out of 1,037,342) of farm households cultivated over five hectares. In contrast, over 50 per cent (15,418 out of 30,707) of corporate farms managed more than five hectares. The government has promoted the expansion and consolidation of farm units. This scaling up has been more readily adopted by corporate farms.

There is also a difference in sales between farm households and corporate farms. The census found that the proportion of farming enterprises with annual sales exceeding 10 million yen (US$68,218) was only 10 per cent (104,953 out of 1,037,342) for farm households but 67 per cent (20,663 out of 30,707) for corporate farms.

An ‘ordinary’ industry would seek a balance between production and the protection of producers to stabilise productivity. The search for this balance is crucial for a sustainable agricultural industry.

Japan’s post-war agricultural policy has prioritised protecting farmers over the future of the industry, largely because of the underlying belief that agriculture is a special industry supported by individual family farmers. In reality, the production capacity of family farmers has been reduced. Agricultural policy must rethink agriculture as an ordinary industry. Looking at the different emerging forms of farming will be a necessary starting point for the industry to develop its long-term vision.

This vision needs to take several key points into account. It must first consider how food items can be secured by balancing domestic production and imports. A holistic approach that determines which crops to produce domestically and which to import with feasible countermeasures would increase food security.

Another possibility, as highlighted in the 2024 amendment, is to promote exports of agricultural products. While many food products have no price advantage, the value of Japan’s agricultural exports have doubled in the past decade, exceeding 1 trillion yen (US$6.8 billion) for the first time in 2021. Exploring foreign markets helps maintain the country’s production base.

A 2024 report by the Mitsubishi Research Institute emphasises the importance of providing opportunities for farmers to refine their management skills, especially after they have started farming, to help them scale up operations. Farming techniques and management practices vary depending on factors such as crops, geographical location and production scale. Sharing this information will enhance the management capacity of individual farming businesses.

Throughout the post-war period, ensuring food security has been imperative for Japanese agriculture. Family-oriented agricultural policy was introduced at a time when farmers accounted for more than a third of the population. Despite the rise of part-time farmers and corporate farms, agricultural policy continues to prioritise support for family farmers. The 2024 amendment to the Basic Law on Food, Agriculture and Rural Areas is no exception.

The agricultural industry faces serious challenges posed by the weakening domestic production base. Japan should prioritise these challenges based on a long-term vision of the industry. Reframing agriculture as an ordinary industry with a range of players, not only family farmers, will pave the way for a viable future.

Yusaku Yoshikawa is an aid consultant at JIN Corporation.