Japanese Tourists Once Shunned Korean Rice for Quality, Now Filling Suitcases with It [AK Radio]

Minister of Agriculture Dismissed After "We Have Plenty of Rice at Home" Remark
Public Outrage Grows Amid Soaring Rice Prices in Japan

A rice crisis is intensifying in Japan. Public sentiment is erupting over the rice turmoil in this advanced nation. Taku Eto, the Minister of Agriculture, Forestry and Fisheries, was immediately dismissed after making the remark, "We have plenty of rice at home." The Japanese government has also drawn criticism for its absurd explanation that rice shortages are due to the large number of Asian tourists consuming excessive amounts of rice.

The photo is unrelated to specific expressions in the article. Getty Images Bank

The dismissed Minister Taku Eto is a hereditary politician from Miyazaki Prefecture, having inherited his father Takami Eto's parliamentary constituency. He is a typical example of Japan's political dynasties. Since the Abe administration, he has continuously served as Minister of Agriculture, Forestry and Fisheries, representing a classic elite local family in Japan.

However, in response to the recent surge in rice prices in Japan, the government has repeatedly avoided responsibility since the beginning of the year. The price of Japanese rice, which was around 2,000 yen per 5 kilograms as of July last year, has now soared to about 4,400 yen, more than doubling in a short period. Despite this serious situation, Minister Eto continued to claim that the government was releasing stockpiles and that the real problem was merchants hoarding rice. He even recently commented that rice prices had been too low for too long.

The decisive blow was his comment, "We have plenty of rice at home," after supporters from his constituency gave him large amounts of rice. This was a statement he should never have made, and it backfired severely. As a result of this gaffe, support for the Ishiba Cabinet plummeted to 27%. If it drops any further, it will reach a critical level where the administration itself could be at risk.

Ultimately, amid growing fears that the cabinet could collapse if the situation was left unchecked, Minister Eto was dismissed, and Shinjiro Koizumi, former Minister of the Environment, was appointed as his successor. Shinjiro Koizumi, widely known in Korea by the nickname 'Punkulsekgwa,' is a highly recognized and popular politician, and his appointment is seen as an effort to contain the crisis.

On the 20th, Eto Taku, former Japanese Minister of Agriculture, Forestry and Fisheries, held a press conference. Amid worsening public sentiment due to the sharp rise in rice prices in Japan, he made a gaffe by stating that his own home had a surplus of rice, which ultimately led to his dismissal. Photo by Reuters Yonhap News

Currently, in Japan, the term "Reiwa Rice Crisis" has emerged, even attaching the emperor's era name to the incident. Due to the sharp rise in rice prices, all rice-related items in Japan's consumer price index have seen price increases of more than 60% compared to last year. As a result, foods containing rice, such as sushi and onigiri, have all experienced significant price hikes.

With rice prices rising rapidly, there have even been reports that schools are reducing rice servings in school lunches and serving bread instead. Even more surprising is that Japanese people, who previously avoided Korean rice, are now flocking to Korea and buying only rice at supermarkets. Until now, Japanese consumers have shunned Korean rice, claiming it is of lower quality than Japanese rice. However, as rice becomes unavailable in Japan, people have started eating Korean rice and found little difference in quality, while the price is only one-third that of Japanese rice. As a result, tourists are buying only rice, packing it in their suitcases, and taking it home.

Korean rice is now even being exported to Japan in large quantities. Previously, Korean rice had only been sent to Japan as humanitarian aid during the 2011 Great East Japan Earthquake, and there had never been any exports. But now, due to the severe shortage, Korean rice is immediately sold out as soon as it arrives in Japan.

The Japanese government has been criticized for trying to deflect public anger toward overtourism by claiming that the rice shortage is due to the excessive number of tourists consuming large amounts of rice. According to government data, average annual rice consumption was about 20,000 tons, but it has now increased to about 70,000 tons, more than tripling. The Japanese government explains that the shortage is due to the influx of tourists from neighboring countries where rice is a staple food, such as Korea, China, and Taiwan.

However, this 70,000 tons accounts for only about 1% of Japan's total annual rice demand. With about 7 million tons of rice sold annually in Japan, many question how a 1% increase in demand could cause rice prices to more than double and make rice nearly impossible to find. Some experts in Japan have even suggested that the government is creating an urban legend.

The government stockpiled rice released in Kanagawa Prefecture, Japan, last March. More than 90% of the stockpiled rice released by the Japanese government was purchased by JA Zennoh, Japan's agricultural cooperative organization, sparking controversy over hoarding. Photo by AFP Yonhap News

Experts in Japan point to two main factors as the root of the problem. One is the long-term rice production reduction policy known as the "gentan policy," and the other is that JA Zennoh, Japan's agricultural cooperative similar to Korea's Nonghyup, has been hoarding rice as soon as it becomes available, thereby driving up prices.

The gentan policy, implemented by the Japanese government from 1971 to 2018, aimed to stabilize rice prices by providing subsidies to farmers who planted other crops instead of rice, thereby continuously reducing rice production. By around 2018, the policy was officially abolished because rice supply had become too low relative to demand. However, the problem is that, unlike the central government, local governments are still providing subsidies to farmers who switch from rice to other crops. As a result, there are concerns that, contrary to central government statistics, rice paddies are disappearing rapidly at the local level, leading to supply issues.

Even more serious is the issue of hoarding by JA Zennoh. JA Zennoh had been buying up rice from farmers at prices above market value and stockpiling it because rice prices had been falling for years. However, when the Japanese government released stockpiled rice last March to curb soaring prices, more than 90% of it was bought up again by JA Zennoh.

This completely nullified the government's attempt to lower prices. Instead of releasing the rice to the market, JA Zennoh has continued to release only small amounts. JA Zennoh claims it must continue to protect farmers' incomes and that, because it bought rice above market value to support farmers, the current market price must be even higher. As a result, there is growing criticism that JA Zennoh is deliberately hoarding rice to cover its own losses. The Japanese government has been slow to address JA Zennoh's hoarding practices, leading to suspicions that the Ministry of Agriculture, Forestry and Fisheries is colluding with the organization.

Because Japan's rice market structure is similar to Korea's, this rice crisis in Japan is expected to have a significant impact on Korea as well. It remains to be seen whether the rice turmoil in Japan will be a short-term phenomenon or whether structural shortages will persist. If rice production in Japan continues to decline structurally, it is expected that Korea's surplus rice will be exported to Japan, opening up a new market.

However, Korea cannot afford to be complacent. Although Korea currently believes that rice production exceeds demand, Japan also believed it had a surplus until the gentan policy ended in 2018. Korea and Japan are following almost identical paths, and if, like Japan, there is a sudden surge in rice demand or a supply shock due to natural disasters or war, there would be no countermeasures.

Although there is criticism in Japan that JA Zennoh and other wholesalers are hoarding rice, in the past, even if such hoarding occurred, production was sufficient to prevent major market disruptions, and prices would normalize within two to three months. However, now that production is barely keeping pace with demand, even a minor supply issue can trigger a rice crisis like the current one.

In Korea, one of the main issues in the upcoming presidential election is the revision of the Grain Management Act, which closely resembles Japan's situation. Therefore, the rice turmoil in Japan is expected to provide valuable lessons for Korean policymakers. Currently, Korea spends about 430 billion won annually on rice purchases, and this is expected to increase once the revised Grain Management Act is implemented. It is necessary to learn from Japan's ongoing rice crisis and use it as a reference for establishing sound policies.