Rice Growers Push for Japan to Open Market : Formal Complaint Asks U.S. to Insist That Import Restrictions Be Eased
The American rice industry filed a formal complaint Wednesday in an effort to enlist the Reagan Administration’s support for its demand that Japan open its enormous rice market to foreign producers.
Japan now protects its inefficient but politically powerful rice farmers, many of whom hold land on the outskirts of Tokyo, from foreign competition. As a result, the nation imports virtually no rice, even though it consumes tremendous amounts, and Japanese consumers pay five to 10 times the world market price.
In a 120-page complaint filed with Clayton K. Yeutter, President Reagan’s trade representative, the U.S. rice industry asked that Japan allow up to 10% of its rice to come from abroad after four years.
Campaigning in California, Vice President George Bush urged Yeutter to take action on the petition “so we can maintain the pressure against barriers to our exports around the world.”
Won Small Concessions
Under U.S. trade law, as amended earlier this year, Yeutter has 45 days--until 11 days before the presidential election--to decide whether to accept the complaint and open talks with the Japanese to solve the issue. If the talks should fail, the President could impose retaliatory measures against Japanese products.
The complaint was filed by the Rice Council for Market Development, a farmers’ group, and the Rice Millers’ Assn. It was unveiled at a news conference sponsored by Sens. Pete Wilson (R-Calif.) and David Pryor (D-Ark.), who represent the nation’s main rice-growing states.
Wilson said California Gov. George Deukmejian, seeking to raise the issue during a recent Tokyo visit, had met with “a stone wall.” Pryor said Japan’s all-but-total ban on imported rice was “precisely what we sought to correct in the trade bill” earlier this year.
Aides to Yeutter declined to make any formal comment on the petition.
In similar cases in the past involving other products, Yeutter has welcomed industry complaints about unfair foreign trade practices. In recent months, negotiations with the Japanese have won small concessions toward lowering trade barriers against foreign beef and citrus products.
But Yeutter declined to press an identical complaint from rice growers in 1986 on the ground that a 96-nation negotiation on agricultural trade policy under the General Agreement on Tariffs and Trade was just getting under way and should be given a chance to resolve the issue.
His aides suggested Wednesday that he may want to put off a formal complaint process this time until after the next round of the GATT agriculture negotiations, set for Montreal in December.
Rice industry officials, however, insisted that the Japanese agriculture ministry had effectively removed Japan’s protectionist rice-import policy from the GATT negotiations by assuring domestic farmers that Japan “intended to maintain self-sufficiency in rice.”
10 Million Tons a Year
J. Stephen Gabbert, president of the Rice Millers’ Assn., said at the news conference that the U.S. rice industry asked for gradual access to the Japanese market because a sudden collapse of trade barriers could disrupt markets worldwide. And that, he added, could result in a tripling of the cost of short-grain Japanese-type rice to American consumers while cutting Japan’s domestic rice bill by as much as 80%.
“We are not looking for an opportunity to flood the Japanese market,” Gabbert said.
Merrill Bateman, a commodity market economist who presented a brief analysis of the industry’s position, said U.S. farmers and millers want Japan to open its domestic rice market by 2.5% of consumption per year for four years. At the end of the period, one-tenth of the nation’s annual consumption of 10 million tons would come from overseas--an estimated 700,000 tons of it from the United States, the rest from Australia and other major rice exporters.
If so, Bateman said, the domestic cost of Japanese rice--as reflected in the price paid the farmer--would decline to about $2,000 from $2,500, while the price of American rice of the same type would rise to $400 from $300. At the end of the four-year period, he estimated, exports of American rice to Japan would add from $130 million to $150 million to U.S. farm export income.