Rice Growers Urge Action on Japan Policy : Call for Retaliation to Allow U.S. Exporting

As the Sacramento River winds down its flat and fertile valley, its waters are siphoned off each year to fill laser-leveled paddies from which emerges a variety of rice favored by the Japanese but effectively excluded from their markets.

“Our rice suits Japanese tastes, and we certainly can compete on price and quality,” claims Gregory Mignano, director of the California State World Trade Commission. “Removal of Japan’s import restrictions could boost California’s rice exports significantly.”

With that in mind, the nation’s rice producers last week asked the Office of the U.S. Trade Representative to retaliate against what they called Japan’s “closed-door policy” on foreign-grown rice. That policy, they charged, violates the U.S. Trade Act of 1974.

“Should Japan not agree to liberalize its rice policy, we are asking President Reagan to use his authority to limit Japan’s sales to the United States by an amount equivalent to our lost market opportunity, or $1.7 billion,” said J. Stephen Gabbert, executive vice president of the Rice Millers’ Assn., which represents California and the five Southern rice-producing states.

10 Times World Price

The Rice Millers’ petition claims that the Japanese government began protecting Japanese rice farmers from international competition 25 years ago and that foreign-grown rice now represents less than 0.2% of Japan’s total domestic rice consumption. Subsidies to Japanese rice farmers have sent prices soaring from 1.6 times the world price in 1960 to about 10 times prevailing world prices, the association claims.

Although California trails Arkansas and Texas as a leading rice producer, Japanese consumers apparently favor its medium-grain rice over the long-grain species grown in the South and popular in this country as well as in much of the rest of the world.

An indication of the popularity of California rice came in response to action taken by the Japanese government, effective Sept. 1, to stop Japanese sailors from bringing small quantities home with them--in all about 20 tons a year.

“Many sailors eagerly bring home California rice because its taste appeals to the Japanese,” Hideo Taira, director of the oceangoing division of the All-Japan Seamen’s Union, wrote in a protesting letter to the national daily Asahi Shimbun.

“The sailors know how delicious California rice tastes when used for sushi, and as professional shippers they are well aware of the thick and high walls that have been erected to keep out foreign rice,” Taira wrote.

Ralph Newman, president of Farmers’ Rice Cooperative in West Sacramento and a director of the Rice Millers’ Assn., said that even without current U.S. trade subsidies for rice, the California grain would still cost Japanese consumers a fifth of what they now pay for home-grown rice.

“Given access to a market like Japan, we wouldn’t need a rice (subsidy) program,” Newman said. Nor would California rice swamp the Japanese market, he added, because the state’s entire rice output amounts to 10% of Japan’s consumption.

The Rice Millers’ Assn., which has been studying the trade issue for several years, decided to strike now, Gabbert said, because the trade deficit with Japan--currently $60 billion and growing--has become a prime political issue in both countries.

‘Under the Gun’

The Office of the U.S. Trade Representative, which is headed by Clayton K. Yeutter, has until the end of next month to respond to the petition, he noted, explaining that this was calculated to encourage a favorable response just days before the Nov. 4 election.

“We feel that the Administration--and especially Yeutter--is under the gun to produce results in the export field after all the rhetoric used to counter protectionist measures in Congress,” Gabbert said.

Moreover, negotiations on opening a new round of international trade talks are about to get under way in Uruguay, and high on the United States’ list of objectives is removal of agricultural trade barriers, he noted.

In addition, the Japanese government has made conciliatory remarks about improving trade relations, prompting Bart S. Fisher, the Rice Millers’ counsel, to comment, “To the government of Japan we say, ‘Put your money where your mouth is--or at least our rice!’ ”