After close to 300 years trading in rice futures, Japan’s Osaka Dojima Commodity Exchange is to end that aspect of the business.
Since 1730 the world’s oldest rice futures exchange has been active but will come to an end in June next year when all outstanding rice contracts expire.
Its closure has been forced by the refusal of Tokyo’s agriculture ministry to re-license the exchange due to falling trading volumes.
The Dojima Exchange, as it was originally known, came into being after samurai petitioned for the authorising of trade in rice futures
Up to that time there had been a ban on rice futures as it was seen as a form of gambling.
Many of the practices developed by the exchange were later adopted around the world.
Exchange president Ikko Nakatsuka, interviewed on Japanese television, said: “We haven’t regarded rice futures as a pillar of our revenue.
“But we believe our rice futures are a useful product for Japanese farmers, so the government’s decision not to approve them is very disappointing.”
Rice plays an important cultural role in Japanese society and its diet though, due to high duties on imports, there is often a surplus.
As a result, the government offers subsidies for alternative forms of farming on the older paddies.