"Japanese Tourists Stockpile Over 10kg in Korea, Shopping Increases 77-Fold [Why&Next]"

Japanese Rice Now Three Times More Expensive Than Korean Rice at 168,800 Won per 20kg
'Export Plant Quarantine Certificate' Required to Bring Korean Rice into Japan
Quarantine Certificate Volume Soars from 16kg to 1,250kg in One Year
First-Ever Successful Export of Korean Rice to Japan

As Japanese rice prices continue to soar, there has been a sharp increase in 'Korean rice shopping' centered around Japanese visitors to Korea and Koreans visiting Japan. Korean rice is about three times cheaper than Japanese rice, leading people to obtain quarantine certificates at airports and personally carry over 10 kg of rice to Japan. Korean rice exports have also been achieved for the first time. This reflects a facet of the sharp rise in Japanese rice prices.

According to the Animal and Plant Quarantine Agency on the 18th, the amount of rice for which export plant quarantine certificates were issued for import into Japan in March this year was 1,250 kg, a 7,712.5% increase (1,234 kg) compared to the same month last year (16 kg). The number of certificates issued also increased significantly from 6 to 119 cases.

The number of quarantine certificates issued and the volume began to increase from August last year, when Japanese rice prices started to rise. In July last year, only 6 certificates for 19 kg were issued, but in August, this rose to 27 certificates for 115 kg, and in September, it increased further to 51 certificates for 376 kg. This year, the upward trend has become even steeper. Certificates issued from January to March this year totaled 193 cases for 1,855 kg, already far exceeding last year's total (174 cases, 1,310 kg). In 2023, it was only 29 cases for 187 kg.

Since October 2018, Japan has required the submission of export plant quarantine certificates when carrying rice into Japan. Therefore, to bring rice purchased in Korea into Japan, one must obtain an export plant quarantine certificate from a plant quarantine officer at a regional office or branch of the Animal and Plant Quarantine Agency located nationwide (airports and ports) in accordance with the Plant Protection Act. The plant quarantine officer conducts quarantine on the plant and issues the export plant quarantine certificate if no pests or diseases are detected and the quarantine is passed. The service is free of charge. If rice is brought into Japan without a quarantine certificate, it will be discarded or returned according to Japan's Plant Protection Act.

Since the quarantine certificate does not record nationality, it is not possible to know the exact nationality of the person importing rice into Japan. However, an official from the Quarantine Agency stated, "Most of the people receiving quarantine certificates are Japanese visiting Korea and returning, and Koreans visiting Japan."

The increase in Korean rice shopping is due to the high price of rice in Japan, which justifies the inconvenience of carrying heavy rice. According to the Japanese Ministry of Agriculture, Forestry and Fisheries, the average price of 5 kg of rice sold at 1,000 supermarkets nationwide from March 31 to April 6 was 4,214 yen (about 42,180 won), rising by 8 yen (about 80 won) in one week. This marks the 14th consecutive week of price increases. For 20 kg, the price reaches 16,856 yen (about 168,800 won). Despite the Japanese government's decision in February this year to release a record 210,000 tons of stockpiled rice, prices have not stabilized. On the other hand, according to the Korea Agro-Fisheries & Food Trade Corporation (aT), the average retail price of Korean rice (20 kg) in March was 55,388 won. This means Japanese rice prices are more than three times higher than Korean rice prices.

The reasons for the surge in Japanese rice prices are complex. Japanese local media cite factors such as ▲poor rice growth due to record heatwaves and drought in summer 2023 ▲increased demand from foreign tourists ▲panic buying and speculative psychology ▲rising rice production costs due to yen depreciation ▲and continuous reduction in rice cultivation area.

From Japan's perspective, it is not easy to increase rice supply by importing foreign rice in earnest. Although Japan could import rice from Korea, where rice is abundant, the tariffs, distribution costs, and margins make Korean rice more expensive than Japanese rice. Like Korea, Japan maintains high tariff policies to protect its domestic rice market. Upon joining the World Trade Organization (WTO), Japan designated rice as an exception item and introduced a tariff-rate quota (TRQ) system, mandating the duty-free import of 770,000 tons of rice annually. For foreign rice beyond this quota, a specific tariff of 341 yen (about 3,400 won) per kilogram is imposed. Thus, importing 20 kg of rice from Korea adds about 68,000 won in tariffs to the price.

However, as Japanese rice prices rise due to supply shortages, 2 tons of Korean rice completed customs clearance on the 8th and was officially imported into Japan. This rice, branded 'Ttangkkeut Haetsal,' was produced by Okcheon Nonghyup in Haenam-gun, Jeollanam-do, milled in March this year from rice harvested last year, and exported to Japan as a pilot project. This is the first time Korean rice has been exported to Japan since statistics on Korean rice exports to Japan began in 1990. The price of the rice exported to Japan this time is about 9,000 yen (about 90,000 won) per 10 kg, including taxes and shipping fees, slightly higher than the average local Japanese 10 kg retail price (8,428 yen, about 85,000 won), but the response to Korean rice in Japan has been positive, and an additional 10 tons departed for Japan on the 20th of this month.

An official from the rice export industry said, "When importing Korean rice, tariffs are applied to the wholesale price, and additional margins are added by local importers and distributors. In this case, Korean rice is unlikely to have price competitiveness in Japan, so importers are still reluctant to bring in Korean rice in earnest."