Japan’s largest rice shortage in years exacerbated by sushi-hungry tourists 

Sushi, rice balls and yakitori — Japanese rice is a staple in many iconic dishes, but the country is facing its biggest shortage in decades.

Japan has been facing a rice shortage in recent months due to bad weather and an increase in tourists, as well as the country's restrictive rice policy.

“Japan has been grappling with rice shortages throughout the summer of 2024, leaving supermarkets empty as demand outstrips production for the past three years, depleting stocks to their lowest levels in more than 20 years,” U.S. Department of Agriculture wrote in a report published last week. The USDA added that consumers are also stocking up on more rice to prepare for Japan's typhoon season and major earthquake warnings.

August, It is reported that white rice is often out of stock in supermarkets Stores are limited to one bag per person. Partial attribution to local media NHK Shortages caused by an influx of tourists have boosted demand for sushi and other rice dishes. price Rice price reached 16,133 yen ($112.67) per 60 kilograms in Augustup 3% quarter-on-quarter and up 5% since the beginning of the year.

Japanese Private rice inventory According to data from the Ministry of Agriculture, Forestry and Fisheries, production in June was 1.56 million tons, the lowest level in years. In addition to preparing for potential natural disasters, Japan Monetary Authority The increase in demand for rice has also been attributed to the influx of tourists driving food service demand.

Oscar Tjakra, senior analyst at global food and agriculture bank Rabobank, said rice consumption by tourists is estimated to increase from 19,000 tons in July 2022 to June 2023. 51,000 tons in June 2024.

Tjakra noted that while tourist consumption has more than doubled, it is still relatively small compared with Japan's domestic rice consumption of more than 7 million tons per year.

Japan received Record 17.8 million visitors In the first half, it was well above pre-pandemic levels. This trend continues 3.3 million tourists arrived in JulyAccording to Japanese tourism statistics, this is the highest ever recorded.

Japan's rice production has also been declining, Tjakra said, as aging rice farmers retire and fewer young people take up the profession. Analysts explained that a series of heat waves and droughts in the second half of last year also affected the harvest.

Joseph Glauber, a senior fellow at the International Food Policy Research Institute, said that despite shrinking rice harvests and a growing foreign appetite for sushi, the country's rice policy remains a key underlying factor in the overall supply decline.

“The Japanese rice economy remains largely isolated from world markets,” Glauber told CNBC.

Japan Imposing 778% tariff on imported rice for Protect rice farmers. Although Japan has committed under its World Trade Organization obligations to import at least about 682,000 tons of rice annually, this rice is largely isolated from Japanese consumers and is used mainly for processing and feed.

Japan's rice exports also increased sixfold from 2014 to 2022, to nearly 30,000 tons, Rabobank's Tjakra observed.

Rising rice prices push Japan's headline inflation rate higher in August Annual increase of 2.8% This comes against a backdrop of rising energy and food costs. Rice and chocolate prices are one of the biggest drivers in the food basket.