Tokyo's rice prices surge 90% in March on year: CPI data
Ideas:
Because Tokyo is the most populous metropolitan area in Japan, there is more demand for rice and maybe suppliers, vendors, and supermarkets are still keeping the price of rice high to maximize their profits, before the supply is stabilized.
Its unfortunate if whomever is keeping the price high as they are only thinking about their small slice of the pie and not thinking about the good of society or Japanese households.
Some might call this "sticky prices" meaning despite and increase in supply which usually brings the price down prices are still remaining high and not going down very fast or fast enough to help society.
An 89.6 percent in rice prices is not very good almost terrible, as maybe the upper-middle class in Japan might not even notice the price increase but for the middle-class, lower-middle class, and those on fixed incomes it definitely is not good as it cuts into any extra income they might have or had.
The Japanese government needs to have some kind of temporary price controls on the price of rice, which puts a limit on how high price the price can go and if needed provide subsidies to the rice suppliers as a way to compensate them too for the good of society, instead of just letting the market decide the price.
It quite possible, whomever, that some suppliers or vendor might have more market power then what is good for society, and something or someone is keeping the price un-naturally high.
Price increases of 11.8 percent, 8.4 percent and 8.7 percent might not seem like that much, but again, for some consumers or households in Japan it might be too much for them.
The price increases might push some Japanese consumers to not buy rice balls or onigiri, bento boxed lunches which are sold mostly at Japanese convenient stores called conbinis or even sushi served at Japanese restaurants now might be too expensive for some Japanese consumers.
Only time will tell the real story how many customers are not going to buy what they used to buy because of the price increases in the Tokyo area.
Again, there could be a breakdown in the rice supply chain and or someone in the supply chain has too much market power and is keeping the price high for their own good and not thinking about the good of Japanese society.
The only good thing about this is maybe foreign rice being imported into Japan, which is priced much lower than domestic Japanese rice , might see an increase in demand as Japanese consumers/households begin to like the taste foreign rice over domestic rice due to the high prices of Japanese rice.
Normally, whenever there is an increase in the supply of a product it should eventually bring down the price of the product, but if the demand of that product is very high it might not bring down the price that much.
If there was supply shortage in 2023 why didn't the Japanese government do something to avoid the situation in the summer of 2024 which caused prices to increase out of control.
Its highly unlikely that the sharp rice in foreign tourists drove up the price of rice alone, as the there are other mitigating variables involved such as the rice supply shortage, increased demand in the Tokyo area among other things such as other supply costs increases and an increase in labor costs too.
No doubt the core consumer price index is increasing as supply and labor costs continue to increase in Japan with no sign for slow-down or even a leveling off of prices.
Japanese households have been experiencing inflation ever since the pandemic started and it hasn't decreased yet.
The Bank of Japan in the past has been saying that the Japanese economy is just too weak for any real key interest rate increases, so they use mini key rate increases to try to lesson the side affects of the rate increases on the Japanese economy.
Have a nice day!
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