The average price of newly harvested rice in Japan surged nearly 50 percent in September compared to the same month last year. The sharp rise reflects higher production costs as well as stronger market demand following a shortage.

Japan's agriculture ministry says prices for all varieties of new rice sold by farming cooperatives to wholesalers averaged 22,700 yen, or 150 dollars, for 60 kilograms, marking a 48-percent rise.

The figure was also the highest on record for September since the ministry began surveying rice prices in 2006.

The year's crop begins appearing in stores in Japan from around September.

The ministry attributes the steep price rise to increased payments by agricultural cooperatives to farmers to cover higher production costs, including fertilizer prices.

Intensifying competition among customers due to a crop shortage also contributed to the higher payments.