Ahead of the new rice harvest, agricultural cooperatives across Japan are increasingly lowering the advance payments they make to farmers. In Niigata Prefecture, the largest producing area, JA Zen-Noh Niigata has cut its payment for top-grade Koshihikari rice to 18,500 yen per 60 kilograms, down 38% from the previous year. In Hokkaido, Hokuren has reduced its payment for Nanatsuboshi rice from 29,000 yen last year to 17,000 yen, a decrease of about 40%. The background is that large stocks of the 2025 crop, which saw high prices, remain unsold, making it difficult to foresee sales of the new rice. Many producing areas are offering payments below the cost indicator of 20,535 yen set by the Ministry of Agriculture, Forestry and Fisheries, raising concerns among producers. At retail, the phenomenon of new rice being cheaper than old rice, known as 'new-old reversal,' is also occurring, and JA Zenchu is urging the government to buy back stockpiled rice earlier.
Large carryover stocks and lower advance payments signal oversupply, pressuring rice futures.
Hokuren reduced Nanatsuboshi payment by ~40% amid high carryover.
JA Zen-Noh Niigata cut advance payment for Koshihikari by 38% due to unsold stocks.
