More people in China importing Japanese rice, seen as safer luxury food

SHANGHAI/TOKYO (Reuters) - First it was European infant formula, then New Zealand milk. Now Chinese consumers are adding Japanese rice to the list of everyday foods they will bring in from abroad at luxury-goods prices because they fear the local alternatives aren't safe.

The volume of rice imported from Japan remains small - 160 tonnes last year, according to Japan's National Federation of Agricultural Cooperative Associations.

But that is more than triple the total in 2013, a trend that illustrates Chinese consumers' dwindling confidence in the safety of the country's own agricultural produce. "Chinese rice farmers use pesticides," said a seller identified as Ying Ying, who started offering Japanese rice on the Taobao online marketplace last August. "Japanese rice isn't polluted by heavy metals."

Japanese rice is neither cheap nor easy to find in China. Japanese rice imported by Chinese grain trader COFCO sells for 74 yuan (S$16) a kg on PinStore, an online supermarket run by Japanese trading house Sumitomo Corp . Domestic rice sells there for as little as 7.5 yuan per kg.

As demand grows, Chinese consumers are increasingly turning to online platforms such as Taobao, run by Alibaba, to buy rice directly from individuals in Japan.

One person seems to have paid as much as 1,499 yuan for 5kg, according to Taobao.

Steep prices, though, are no deterrent for some. "Much tastier than Chinese rice. Worth every cent - great texture and taste," one delighted buyer wrote on Taobao.

To meet demand, some Chinese producers now say they use Japanese seeds and promote their rice as a safer alternative to purely domestic strains.

Zhejiang Xinxie Yueguang Agricultural Science and Technology says its Echizen brand rice is safe and grown with "water from pure sources and strict quality control". The packaging says the rice is a Japanese variety.

But Echizen rice is grown in Changxing county, a hub of lead-acid battery production in eastern Zhejiang province. Battery production can be highly polluting.

Mr Li Jun, general manager at Zhejiang Xinxie Yueguang, insisted the company's rice had passed tests for lead, cadmium, mercury, pesticides and other chemicals by state inspectors.

The company had also found other areas to grow rice where there was less concern about pollution, Mr Li said.

Pollution from industrialisation has exacted a heavy toll on China's soil and water. In May 2013, officials in Guangdong province in southern China said 44 per cent of rice samples contained excessive levels of the metal cadmium.

A study by the Ministry of Environmental Protection last April estimated that 16.1 per cent of China's soil was contaminated. In parts of the country, soil pollution is so bad that some rice farmers refuse to eat what they grow.

After the cadmium revelations, some Chinese consumers began to see rice from Thailand as an affordable and safe substitute.

The Chinese eat around 120 million tonnes of rice a year and the country imported more than 2.2 million in the first 11 months of 2014, including 1.2 million tonnes from Vietnam and 626,000 tonnes from Thailand, customs data shows.

Japan is a small rice exporter - just 3,777 tonnes in January to November 2014, according to Agriculture Ministry data - but it is looking to boost shipments to Asian countries as part of a wider push to export more agricultural products.

However, if the trend to China looks encouraging, any further increase through normal export channels may be slow: the Chinese authorities have given just one Japanese rice mill clearance to send polished rice.

Others have begun an application process but that has stalled. Some would-be suppliers have been waiting for three years, a Japanese government official said.