In Japan, futures trading for rice started in 1730 at Dojima, Osaka, with the Tokugawa shogunate's approval. Such trading ended in 1939 as the government's wartime control of the economy was strengthened. On Aug. 8, futures trading for rice resumed in Tokyo and Osaka for the first time in 72 years.
The farm ministry approved the trading on an experimental basis. It hopes that futures trading will lead to the posting of bellwether prices for rice, thus helping farmers and traders evade risks in price fluctuations. If prices appear likely to greatly fluctuate, the ministry will order the Tokyo and Osaka exchanges to restrict trade volume or halt the trading.
After a two-year trial, the ministry will decide on whether to turn the trading into full-scale futures trading.