Japan Rice Prices Jump on Radiation Rumors

Fears that rice from the disaster-struck Tohoku region will turn out to have unsafe levels of radiation have sent up trading prices about 10 percent from the same period last year.

No rice harvested this year has been found to have radiation levels exceeding legal standards, but many wholesalers are worried that some rice may be deemed unsafe when full-scale testing begins of rice from Tohoku, a major rice-growing region.

Many wholesalers are rushing to secure rice from the Hokuriku and Kanto regions as well as western Japan in hopes of entirely avoiding rice from the Tohoku region due to unfounded rumors of contamination by radioactive fallout from the meltdown of reactors at the Fukushima 1 nuclear power plant.

Another factor that is driving up rice prices is hoarding by consumers after the March 11 Great East Japan Earthquake.

Despite the March disaster, Japan has enjoyed strong nationwide rice harvests nthis year, including in Fukushima, Miyagi and Iwate prefectures, according to the Agriculture Ministry. If rice from the Tohoku region is found to be safe, the prices of rice is likely to drop substantially.

Rice prices are set based on negotiations between the National Federation of Agricultural Cooperative Associations (Zen-Noh) and wholesalers. Each week Zen-Noh announces benchmark prices to guide trading. For new rice harvested this year in major producing areas Zen-Noh has released a benchmark price of 15,500 yen (about $207) per 60 kilograms (38 pounds) for Koshihiakri rice harvested in Ibaraki, Chiba and Shiga prefectures. That price is 12 to 14 percent higher than those of the same period last year.

This year’s trading prices of Koshihikari rice from Mie Prefecture are about 14 percent higher, while those of the Yumetsukushi brand rice from Fukuoka Prefecture are up about 9 percent.

The average retail price of rice harvested last year was around 1,800 yen ($24) per 5 kg (12.5 lbs.), according to the Ministry of Agriculture, Forestry and Fisheries.