Research and Markets: Japan Agribusiness Report Q1 2009

DUBLIN--(BUSINESS WIRE)--Research and Markets (http://www.researchandmarkets.com/research/44cce8/japan_agribusiness) has announced the addition of the "Japan Agribusiness Report Q1 2009" report to their offering.

Japan Agribusiness service provides proprietary medium term price forecasts for key commodities, including corn, wheat, rice, sugar, cocoa, coffee, soy and milk; in addition to newly-researched competitive intelligence on leading agribusiness producers, traders and suppliers; in-depth analysis of latest industry developments; and essential industry context on Japan's agribusiness service.

Despite having an advanced level of mechanisation and high yields, Japanese agriculture is largely unprofitable and is able to supply less than 40% of the country's food needs. In this new Japan Agribusiness Report for Q1 2009, we examine the challenges that the agriculture sector in Japan faces over the coming years.

Between 1960 and 2005 Japan's food self sufficiency in a calorie basis fell from 73% to 40%. Over the same period, the share of agriculture as a proportion of GDP dropped from 9% to 1% and the area of agricultural land fell from 6.09mn hectares (ha) to 4.60mn ha.

While Japanese agriculture has enjoyed some successes, such as achieving self sufficiency in milk and rice production, farming has never really been profitable without protection from imports and heavy government support in the form of subsidies and price supports. Even production of the key staple rice has fallen over the last two decades as consumption has dropped.

Indeed, the change in the Japanese diet has left agriculture lagging since the 1970s. As incomes improved and the variety of Western products available increased, per capita rice consumption fell while demand support for rice producers worked against farmers switching to produce other crops and imports of wheat and corn for animal feed increased.

Part of the reason why farming in Japan has come to be so reliant on government hand outs and protection is the small size of plots. In 2007, the average size of rice farms was a mere 1.2ha. Many of these are farmed on a part-time basis and are too small to make a profit without government support. The majority of farmers running these plots are now well into old age, with almost 50% aged over 70 and a further 20% aged between 60 and 70. There seems to be little interest among the younger generation to take over these small, family farms. With the right policies, this could present an opportunity for the consolidation of the farm sector. However, the Japanese system of farm support has often worked against the development of large farms.

The ministry of agriculture has for years been trying to reverse the fall in food production. This has been given added impetus over the last couple of years by the rise in food prices and the worries over food security in food-importing nations. While campaigns to try and turn back the clock and get consumers to eat more rice seem doomed to failure, the ministry is also encouraging the use of rice in animal feed and rice flour in food processing.

While these measures could boost food self-sufficiency, at present the cost of production in Japan is so high, that for farmers and food processors to buy Japanese rice rather than imported grain, huge subsidies would be needed. With the cost of support to the agricultural sector already over JPY5trn (US$55bn) according to OECD figures, approximately equal to total agricultural GDP, any policy that requires an increased level of government support seems somewhat short sighted.

Key Topics Covered:

• Executive
• SWOT Analysis
• Sub-sector Supply & Demand Analysis
• Commodity Price Forecasts
• Competitive Landscape
• Downstream Supply Chain Context
• Macroeconomic Context
• Forecast Modelling

For more information visit http://www.researchandmarkets.com/research/44cce8/japan_agribusiness