Report No.250102
Vol.25 No.1-2 Sept. and Oct., 2007


- Domestic -

MAFF Start Discussion on Creating Demand for Rice

Ministry of Agriculture, Forestry and Fisheries announced an estimation that rice consumption would drop to 6.70 million ton in 2025, a 20 percent decrease from the present level. A scenario on which the estimation is based is that the per capita consumption of rice will continuously reduce at the same rate as in these days on the premise of decreasing population. The ministry embarked upon a discussion about the way to create new demand for rice other than as staple food, including raw material for bio-ethanol and animal feed. 

The per capita consumption decreased by 520 gram a year in average for five years from 2002 to 2006. If the rate of decrease remains the same, the figure will fall from 61 kg in 2006 to 51 kg in 2025. The population in Japan is on the decline after reaching a peak of 128 million people in FY 2004. According to a projection from National Institute of Population and Social Security Research, it will drop to 119 million people in 2025.

Given all the factors, the consumption is estimated to be around 6.70 million ton in 2025, down by some 1.90 million from some 8.60 million ton in 2006. Our calculation indicates that planted area should be reduced by approximately 0.36 million ha from the present level so as to realize the production commensurate with the demand.

Even based only on the decrease in the population with the per capita consumption remaining the same, the annual consumption is expected to fall by 0.6 million ton to 8 million ton in 2025. This means that an effort to promote crop change would need to cover about 0.11 ha of paddy field.

Taking the estimated figures into consideration, the ministry determined that "the consumption of rice as staple food would not grow significantly" (according to Staple Food Department). As one of important issues to be discussed, Panel on "Sale"-centered Rice System, which was set up on October 2 2007 to contemplate the future of paddy fields faming, identified the creation of new demand for rice other than as staple food.

Specifically, potential new demand would include as materials for bio-ethanol that has received growing attention worldwide in response to soaring oil prices and global environmental issues, and rice flour that may be used for processing. In addition, rice is becoming a valuable ingredient in animal feed whose prices show sharp rise.

In any event, however, the greatest challenge will be the cost reduction for the substantial spread.

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