TOKYO, May 26 (News On Japan) - As rice prices hit historic highs, the government is moving to counter rising costs by offering reserve rice to major retailers at a target price of around 2,000 yen for 5 kilograms, Agriculture Minister Koizumi announced on May 26th.
Average rice prices in supermarkets have more than doubled over the past year. According to data, the average retail price for 5 kilograms reached 4,268 yen between May 5th and 11th, climbing further to a record 4,285 yen the following week.
Koizumi said that, based on standard retail margins, the reserve rice could be sold at stores for about 2,000 yen per 5 kilograms. The goal is to offer an affordable alternative to high-priced premium rice and imported varieties, thereby broadening consumer options.
While the move could ease the financial burden on households, economic analyst Mariko Mabuchi cautioned that smaller retailers may be left behind. “It’s good for consumers to have options, but we need to consider whether this will pressure small stores,” she said.
The new initiative involves shifting from the traditional competitive bidding system to discretionary contracts with large supermarket chains. A total of 300,000 tons of reserve rice will be released—comparable to the combined amount of the past three releases.
Starting May 26th, interested companies can apply via email, with contracts awarded on a first-come, first-served basis. Koizumi indicated that if demand remains strong, there is potential for unlimited release. The government will also shoulder transportation costs, further reducing price pressure.
One major change is the elimination of middlemen. Under the new model, rice will be sold directly to retailers, bypassing JA-affiliated collection agents and wholesalers, helping to cut costs and speed up distribution.
However, eligibility for contracts is limited to retailers handling at least 10,000 tons of rice annually—effectively restricting participation to major supermarket chains. For example, supermarket Akidai, which handles only 10 tons per year, is excluded from the program.
This concentration of distribution in large urban stores has raised concerns about regional inequality. While the government says it aims to start with major chains and gradually ease conditions, critics argue that fairness must be prioritized.
Mabuchi pointed out that shifting from regulated pricing to a more market-driven model has introduced inconsistencies. “Unless distribution is based on population by prefecture or municipality, small retailers will likely lose out,” she warned.
Broadcaster Mai Demizu added that data-driven systems could ensure rice reaches a wider network of stores by allocating a percentage of supply based on annual sales.
Addressing the fairness issue, Koizumi acknowledged that retailers below the 10,000-ton threshold would need support. To that end, a 500-person “special team” was launched on May 26th, headed by the administrative vice-minister and drawing staff from regional agricultural bureaus.
Naoya Matsudaira, an assistant professor at Utsunomiya University, said that cutting out intermediaries makes the 2,000 yen target feasible, especially for early adopters of the scheme.
Source: TBS
