Rice Tariffs and Their Impact on the Japanese Market

Author Name KEIDA Masayuki  (Rissho University)
Creation Date/NO. August 2014 14-J-043
Research Project Issues Faced by Japan's Economy and Economic Policy Part III: Heterogeneity among economic agents
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In this paper, we analyze how the volume of rice imports would be affected if the Japanese government were to reduce tariffs on rice by looking at the current state of the Simultaneous Buy-and-Sell (SBS) system for rice imports. The Japanese government is required to import 770,000 tons of rice per year to maintain minimum access. However, a large portion of minimum access rice is not used for domestic consumption—only 100,000 tons of SBS rice is used for human consumption. Under the SBS system, the total amount of rice fell short of the government's 100,000-ton annual quota in 2010 and 2013. This was due to a drop in domestic market prices as well as an increase in overseas market prices. The lack of bids on SBS rice in recent years suggests that reducing rice tariffs would have no effect on the domestic market. As a result, we argue that rice tariffs of between 150% and 200% do not affect the Japanese rice market.