Rice Shortage and Rapid Price Increase
November 5, 2025 — Rice is Japanese sake’s main raw ingredient and a critical factor in determining quality. Approximately 3% of Japan’s total rice production is used for sake brewing, and the types of rice used to make sake fall into three categories: 1) rice developed specifically for sake brewing, known as sake rice, 2) rice for making processed foods like sake and miso, called processing rice, and 3) table rice and others. In 2023, the percentages of these three categories used for sake production was 42% sake rice, followed by processing rice at 35%, and table rice and others at 23%.
However, an on-going rice shortage is causing prices to soar, presenting a major challenge
to the sake industry. Because this issue greatly affects the production volume, price, and even export strategy of sake, the Japan Sake and Shochu Makers Association (JSS) takes it extremely seriously and is closely monitoring the trend.
Processing rice: falling incentives and rising prices
Processing rice refers to rice used to produce processed foods like sake, miso, and rice crackers. Because its price is low, sake breweries often use it for products in the mid-to-low price range. The Japanese government has subsidized the production of processing rice to keep its price lower than that of table rice (rice for eating). However, recently table rice has been hit by a rapid price surge of over 50%, which is leading to a disruption in the
production and pricing of processing rice as well. The surge in table rice prices was produced by a combination of factors including government policy, climate change, and a sudden increase in demand. In response to a long-term decrease in table rice consumption in the last half of the twentieth century, the Japanese government implemented an acreage reduction program known as the “gentan” policy, which reduced production year-by-year for about 50 years until it was suspended in 2018. Over the same period, climate change reduced yields, and then in recent years came a jump in demand for dining-out due to a sharp rise in foreign tourists, which led to a major disruption of the supply–demand balance in 2024. The resulting surge in table rice prices has prompted some farmers to plant table rice instead of processing rice, and so the volume of processing rice in 2025 is expected to decrease and its price to rise.
Sake rice: pride under pressure
The situation of sake rice is even more complicated. Sake rice is notoriously difficult to grow because it is taller than other types of rice and tends to fall over in the fields — a phenomenon known as “lodging” that complicates harvesting and reduces yield.
Despite being so difficult to grow, JA Hyogo Rokko’s Managing Director Takashi Fujimoto points out that the farmers who produce Yamada Nishiki take pride in growing it. This is significant because Hyogo Prefecture, the home of “Yamada Nishiki,” accounts for more than 30% of the total production of sake rice.
Fujimoto says, “Due to the acreage reduction policy, many farmers had lost their pride. Even if they wanted to grow more, they had been forced to reduce production. However, the situation of farmers cultivating Yamada Nishiki is different. Here we have the ‘Muramai system.’
Under this system, sake rice produced by designated district farmers is, in principle, entirely purchased by specific sake breweries. In turn, when breweries are in difficult situations (for example, during the Great Hanshin–Awaji Earthquake), the farmers provide labor support to the breweries free of charge—this is a mutual aid system. Through this system, a special relationship of trust is formed between breweries and sake rice producers, fostering a sense of ‘responsibility’ for stable supply. Also, by seeing the faces and brand names of brewers who use the rice they grew with all their effort, the farmers have felt a strong ‘sense of purpose.’” As Managing Director of JA Hyogo Rokko, Fujimoto speaks for Yamada Nishiki producers throughout the prefecture. Thanks to this “responsibility” and “sense of purpose,” in this region there are few signs of farmers switching from Yamada Nishiki to table rice. However, in other regions, it is believed that a considerable number of farmers have already moved from sake rice production to table rice cultivation.
The JSS response to breweries and rice farmers under stress
The number of rice farmers decreased by about 25% between 2015 and 2020, and the average age of farmers is increasing.
Prices for essential farming resources such as fertilizers are rising, and it can be said that to make rice farming sustainable a rise in rice prices is inevitable. What is problematic is the excessive speed of the current rise in prices. In response to this unpredictable situation, the JSS has introduced the “Emergency Guarantee System for Sharp Rice Price Increases,” which guarantees debt when breweries borrow production funds (mainly rice purchase funds) from financial institutions, to help breweries overcome this emergency situation.
In addition, the Association is urging the government to expand the scope of subsidy programs for farmers to include sake rice, which is currently excluded from such support. Because the production volume and price of sake rice and processing rice remain uncertain, the JSS will continue to monitor this situation closely.
