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Japan Agribusiness Report Q4 2009Published by: Business Monitor International Published: Sep. 18, 2009 - 56 Pages Table of Contents
AbstractIn 2008, Japan's food self-sufficiency on a calorie basis climbed one percentage point from 2007 to 41%,the Ministry of Agriculture, Forestry and Fisheries (MAFF) said in August. This is the second annualincrease following a nadir of 39% in 2006. The rise was achieved by an increase in domestic productionof commodities such as rice and sugar and a fall in imports owing to the high prices of agriculturalcommodities on the world market in 2007 and 2008.In 2009, the rise is unlikely to be repeated. Japanese agriculture has been hit by a cool and wet summer,threatening large falls in crop yields. Rice production is likely to be well down on last year's harvest of8.82mn tonnes and could well fall below the level of consumption for the first time since 2003. Wheatproduction is also forecast to fall, with imports expected to rise, boosted by the strong yen and lowerprices on the world market. A fall in the price at which wheat is sold to millers will also prevent demandfor wheat falling by a large amount in the face of the economic slowdown. Meat imports are also set to rise in 2009. The economic slowdown is encouraging consumers to moveaway from expensive domestically produced meat, particularly beef, and trade down to less well regardedimported cuts. Beef imports were up 3% year-on-year (y-o-y) in the first half of 2009. US beef provedparticularly popular with imports rising 24% to take the US' market share to 11%. Japanese-producedbeef is often more than twice the price of imported beef and the price of local cuts has remainedstubbornly high despite the poor state of the economy. Consumption of fluid milk, for which Japan is self-sufficient, has also been hit by the slowdown. In thefirst half of 2009, production of milk for fluid consumption fell 3.1% y-o-y. This is line with our forecastfor a full-year fall in fluid milk consumption of 3.3% y-o-y in 2009. This is an acceleration of a long-termtrend for falling milk demand. A raise in the retail price of fluid milk in March only exacerbated the fall. All the above factors will likely increase Japan's reliance on food imports in 2009, though a fall indemand for imported luxury foods could slow the rise. The Democratic Party, who seized power in theAugust general election, stated during the run up their ambitious goal of increasing Japan's food selfsufficiencylevel to 50% within 10 years and then to 60% in 20. Party strongman Katsuya Okada had alsosaid he hopes to liberalise the sector stating in an interview with Reuters that food security and free tradeare not incompatible. Any changes to Japan's tightly controlled agricultural sector would lead to strongresistance from the farming lobby and plans to liberalise trade in agricultural policies could well bequietly dropped now the Democrats are in power. Indeed, shortly after releasing its manifesto, the partyinserted a line assuring farmers they would be protected from any free trade agreement with the US. Get Full Details About This Report >> |
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