Sustained high rice prices in Japan has forced Japanese feed millers to incorporate corn into their rations. According to a recent Grain and Feed Update from the Foreign Agricultural Service (FAS) of the United States Department of Agriculture, Japanese feed industry is shifting their focus towards corn in response to food inflation stemming from a market disruption that began in summer 2024. This adjustment is anticipated to drive higher corn imports in the 2025-26 marketing year (MY), while enhanced domestic rice production is projected to curtail rice imports.
FAS Forecasts High Corn Imports in Response to High Rice Prices
FAS, in this context, has forecasted a 2.2% rise in corn imports for MY 2025-26, reaching 15.8 million tonnes, the highest volume in six years. This increase is attributed to softening global corn prices and a strategic substitution of rice in feed formulations, where rice has become less economically viable due to its elevated cost and grain market is looking for a market shift.
Japan’s rice sector has experienced significant challenges since the 2024 rice shortage, which was exacerbated by historically low stocks, adverse weather impacts on the 2023 harvest, and unanticipated surges in demand from tourism and stockpiling behaviors. For the unversed, Feed market comprises of people or companies that operate feed mills, facilities which process, grind, and mix grains and other ingredients to manufacture nutritionally balanced animal feed.
Rice Prices in Japan Continue to Climb Through 2025
Despite government interventions and crucial steps by the govt the elevated prices of rice in Japan are still not under control. The food inflation further prompted the Ministry of Agriculture, Forestry and Fisheries (MAFF) to release emergency rice supplies and implement measures to stabilize the market. In reaction to the elevated prices, Japan agri sector have expanded cultivation areas and achieved improved yields of rice, leading the FAS to estimate a robust rice harvest for MY 2025-26.
Table Rice Production Poised to Grow
Table rice production is expected to grow by 10% to 6.8 million tonnes, whereas rice designated for feed industry is projected to halve to 240,000 tonnes. This shift reflects a broader trend away from rice in non-food applications. Rice consumption in MY 2024-25 is estimated at 8.1 million tonnes, marking a 1.8% decline from the previous year.
While demand for table rice has remained stable, overall consumption has decreased, primarily due to a 30% reduction in usage of feed market during the first 10 months of the current marketing year. However, after the crucial steps by the govt. and improved domestic output of rice, the FAS anticipates a reduction in rice imports for MY 2025-26 which surged to 88,706 tonnes in the first 11 months of MY 2024-25. Rice prices in Japan are also expected to decline after the improved domestic output.
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