Japan is staring down a food shock. Not from imports. Not from war. From rice. The price of Japan’s most essential staple has more than doubled in the past year. Government data confirms a 101.7 percent year-over-year spike in May. That follows a 98.4 percent jump in April and a 92.1 percent surge in March. This is not a blip. This is a trend. And it’s rewriting the country’s inflation story.
Wow! Rice prices in Japan have more than doubled from a year ago. Up nearly 102%!
Even though the direct weight in the Japanese #CPI basket is only around 0.6%, rice alone adds > 0.6% to overall inflation. That's huge! pic.twitter.com/BLj3fbmqMv— jeroen blokland (@jsblokland) June 20, 2025
Rice makes up just 0.6 percent of Japan’s official consumer price index. But that number is misleading. Because rice is not just a food item. It’s a multiplier. It feeds into processed foods, restaurant menus, school lunches, and household budgets. Economists now estimate that rice alone is contributing more than 0.6 percent to overall inflation. That’s a distortion. And it’s hitting every level of the economy.
The causes are layered. A record heatwave in 2023 scorched yields. Stink bug infestations wiped out large portions of the crop. Panic buying followed earthquake warnings last August, draining retail shelves. Then came the wheat shortage, driven by the Russia–Ukraine war. Consumers pivoted to rice. Demand spiked. Supply didn’t. Prices took off.
The average five-kilogram bag of rice now costs ¥4,268, or about $29.90. That’s up from ¥2,228 a year ago. For a family consuming 20 kilograms a month, that’s an extra ¥98,000 annually. In a country where over 30 percent of households earn less than ¥3 million per year.
The government has tried to intervene. Emergency stockpiles have been released. Another 200,000 metric tons were promised this month. But the structural issues remain. Japan’s rice farming is dominated by small-scale producers. Two-thirds of farmers cultivate less than one hectare. That model cannot scale. And it cannot absorb shocks.
Inflation is now running at 3.7 percent. That’s the highest since January 2023. Core-core inflation, which strips out both energy and fresh food, is at 3.3 percent. The Bank of Japan is holding rates at 0.5 percent. But the pressure is building. The central bank says it will raise rates only when it sees “more conviction” that inflation will stabilize. That conviction is getting harder to find.
The political fallout is already visible. Prime Minister Shigeru Ishiba’s approval ratings are sliding. His party lost its lower house majority last October. Now, with upper house elections looming, the rice crisis is becoming a referendum. The government has floated cash handouts. ¥20,000 per citizen. Double for children. But the public isn’t buying it. They’re buying rice. And paying double.
Sources:
https://www.allaroundworlds.com/japan-rice-prices-core-inflation-may-2025/