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Japan’s cherry production continues to fall

Japan’s cherry production continues to fall

 

Japan’s cherry production fell 5% in the 2018/19 campaign five to 18,100 tons, of which 16,200 tons was commercially distributed, according to FAS/Tokyo data. For the 2019/20 campaign, a further drop of 6% (to 17,000 tons) is predicted. The causes of this shrinkage are a slightly reduced acreage and the colder temperatures recorded during flowering in Yamagata prefecture, Japan’s main production area.

The US is the main supplier of imported fresh cherries to Japan.  The smaller 2018/19 US crop led to higher prices and a cut in Japan’s fresh cherry imports of 37%. This year’s larger crop is expected to result in a 31% rise in imports to 4,300 tons.  Japan’s cherry exports are negligible. 

 

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Decline in Japan’s peach output

Decline in Japan’s peach output

 

Japan’s 2018/19 peach crop was down 9.5% to 111,500 tons, as the hot June and July with little rainfall during the maturation period July reduced fruit size. The 2019/20 harvest is expected to be similarly impacted by the weather, with FAS/Tokyo forecasting a fall in output of 11.7% to 100,000 tons. In Western Japan, up to 10% of peach trees were damaged by a typhoon in autumn 2018, while frost and hail caused damage in the centre of the country. 

In 2018/19, Japan’s fresh peach exports totalled 1,726 tons (worth US$16 million). The main destination markets are Hong Kong and Taiwan. With a smaller crop expected, exports are forecast to fall 13% in 2019/20 to 1,500 tons. The US is the only country that can export peaches to Japan.

 

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South Africa spies openings for citrus in Japan

South Africa has seen a general decline in shipments of citrus to Japan. Since 2013, citrus volumes (mainly grapefruit) shipped to the Asian country have slipped from 62,000 pallets per year to 41,000 pallets. Japan represents a key grapefruit market for South African, with trade between the two countries stretching back to the 1970s. South Africa is now looking to increase exports of other citrus varieties. South Africa has been applying for a review of the protocol and the cold treatment requirements with no response as yet from Japan. Another complication is that Japan’s policy is to require access applications per variety of soft citrus, in contrast with international standards.

 

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First charter ship carrying Zespri Kiwifruit sets sail for China and Japan

First charter ship carrying Zespri Kiwifruit sets sail for China and Japan

The first charter vessel carrying Zespri SunGold Kiwifruit is heading to China and Japan following this season’s early start to harvest.

The Southampton Star departed from Tauranga Harbour yesterday evening carrying approximately 3,000 pallets of Bay of Plenty-grown SunGold Kiwifruit bound for Shanghai and Kobe. The vessel had earlier berthed in Gisborne where it picked up 1,600 pallets of SunGold Kiwifruit, marking the start of what promises to be another bumper crop.

Zespri Chief Grower and Alliances Officer David Courtney says in total, Zespri expects more than 600,000 pallets of kiwifruit to be shipped offshore this season.

“This will mean we’ll have more than 18,000 containers to ship this season. We’re also expecting to use 45 charter vessels – three to move our kiwifruit to Northern Europe, twelve to service our Mediterranean markets and thirty to take fruit up to Japan, China and Korea. “ 

For the first time, Zespri is also expecting to supply more gold kiwifruit than green this season.

“Last season we supplied 76 million trays of Green and 65 million trays of SunGold. Our latest estimates indicate we are on track to supply more than 75 million trays of SunGold this season, while Green is expected to be below 75 million trays.

“Most of our growing regions have had a very dry summer which means we’re certainly expecting a great tasting fruit this season,” Mr Courtney says.

Greater China and Japan remain Zespri’s two most significant markets and are expected to continue to perform strongly as Zespri expands into new areas within these markets.

“Zespri is still seeing strong growth in China and Japan led by increasing consumer demand for SunGold and more broadly, we’re seeing some excellent results in South East and East Asia.

“With the first shipment of Zespri’s SunGold Kiwifruit now safely aboard, we look forward to introducing the goodness of kiwifruit and its health benefits to consumers across the world and continuing to move closer to our goal of increasing our global kiwifruit sales to $4.5 billion by 2025,” says Mr Courtney.

 

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Australia and Japan partner up to grow fruit

New Australian project for protected cropping 

Australia and Japan have signed an agreement to work together to ensure year-round supply of fruit. At a summit in November 2018, the Australian and Japanese prime ministers agreed to devise a cooperative fruit supply programme, to take advantage of the two countries’ complementarily opposing seasons. Australian producers in the north-eastern town of Ayr will grow a local variety of melons using Japanese growing techniques to reproduce the quality and flavour that Japanese consumers prefer. The project will include a contribution from each country of farmland and technical personnel. Farmers will be able to monitor production via video link and offer instructions to staff onsite. Other products to be grown in the Ayr region include persimmon and strawberries, which will be exported to Asian markets. The aim is to target the gifting fruit culture that is growing among Asia’s expanding middle class. Australia chose Ayr as its production region in a bid to drive economic development in the area.

 

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Yello apple makes its debut at Interpoma

Created in Japan, exclusively harvested and marketed for Europe in Alto Adige - Südtirol, the new yellow apple Yello® made its world debut at Interpoma 2016 in Bolzano

The Japanese-bred yellow apple Yello® – being exclusively grown and marketed for Europe in northern Italy – made its debut on November 25 at the Interpoma trade show in Bolzano.

The new apple variety behind the Yello trademark, Shinano Gold, was created in Nagano in 1993 from a cross between the Golden Delicious and the Senshu. The Yello trademark is now registered in 60 countries.

In 2005, the tree was planted in South Tyrol, the major Italian apple growing area, for the first time and a decade later, in 2015, the first harvest of Shinano Gold grown in Alto Adige – Südtirol took place.

This year, an exclusive license for the production and marketing of Shinano Gold in Europe and the Mediterranean basin was signed between Japan’s Nagano Prefecture and VOG, the Association of South Tyrolean Fruit Growers’ Cooperatives, and VI.P, the Association of Val Venosta Fruit Growers’ Cooperatives.

Yello has smooth alabaster yellow-coloured skin and a sweet, crunchy and juicy centre, they said in a press release.

VOG director Gerhard Dichgans said Yello provides an excellent opportunity to break new ground in the yellow apple segment, historically the realm of a single traditional variety.

“With Yello we also want to write a new chapter in the markets in which the Golden Delicious has for years been left in the shadows, such as in the UK and Germany,” he said.

VOG chairman Georg Kössler said such innovation is key for the future of apple growing in Alto Adige – Südtirol, where over 150,000 Shinano Gold trees will be planted over 2017-18.

Sensory analysis
From a sensory perspective, the pleasant straw-yellow colour of the skin combines harmoniously with its intense and slightly exotic and tropical aroma. This intensifies in the mouth with the appearance of pineapple, pear, honey and lemon peel notes.
The flesh of the fruit is fine and compact, and combines perfectly with its crunchiness and juiciness. Consumers that prefer sweet apples will appreciate its low acidity, notable sweetness and aroma.

Characteristics
Peel: yellow
Flesh: sweet, crunchy and juicy
Shelf-life: excellent
Maturation: 2 weeks after the Golden Delicious
Productivity: like the Gala
Harvest: several stages required
Reduced susceptibility to russeting
Good resistance to bruising
Flesh firmness: 7-8 kg/cm² at harvest  
Sugar content: 14 – 16 ° Brix at harvest  
Acid content: 4 – 5 g/l MA at harvest

Pairings
Thanks to its slight tropical aroma and notable sweetness it goes well with exotic spices such as ginger, curry or rare varieties of pepper in preparations such as chutney or in sweet and sour dishes, giving them perfect sensory balance. The Shinano Gold apple is also excellent with mature cheeses such as Parmesan or blue cheese.

 

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Record exports of Australian grapes

Australian growers need to supply fruit with high sugar content, crisp berries and consistent bunch colour in order to command a premium price over the significant volumes being produced by Chile

Experts believe Japan could easily become Aus­tralia’s second-biggest trading partner after China, according to Australian Table Grape Association CEO Jeff Scott.

Scott said there has been growth in only two categories in the Japanese fresh produce market — table grapes and kiwifruit, reports The Weekly Times.

Japan is currently the fourth-largest export market for Australian table grapes and this year exports there are up 406% on the previous year.

Indeed, Australia’s table grape exports have taken off in general this year.

The country’s 2015-16 table grape export season has seen 108,594 tons exported by the end of May with an estimated value of AUD $364 million, up 32% on the same time last season.

China is the top destination, followed by Indonesia.

Scott stressed the importance of product differentiation in allowing Australian grape growers to compete with those in Chile, South Africa and Peru.

Australian growers need to supply fruit with high sugar content, crisp berries and consistent bunch colour in order to command a premium price over the significant volumes being produced by Chile, he said

Source: Table grapes in price spike as exports take off, Shannon Twomey, The Weekly Times

 

 

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Insights into food retailing in Japan

What exporters need to know about the Japanese retail food industry.

About 23% of household spending in Japan is on food. It’s a country where tastes and preferences are heavily influenced by cultural, societal and environmental drivers. Japanese culture, for instance, places strong emphasis on the four seasons, which is reflected in changes in purchase habits and gift-giving patterns over the year.

According to a USDA Gain report, Japan is also a nation that prefers convenience, quality, and single-serving sizes. More than 3 million people commute via a combination of train and walking into Tokyo every day and highly value convenience and accessibility.

Key target markets in Japan: seniors and young people

Japan’s population is aging faster than any in the world and its Generation M is the fastest growing senior population (over 65) in the world. The roughly 35 million citizens in this generation are expanding the influence of the silver demographic, estimated to now represent about 27% of the Japanese population but set to reach 36% by 2040.

The retail response has come in the form of delivery services, mobile operations, expanded internet shopping, smart phone market integration, promotions, and products developed with Generation M in mind. Because many elderly can not drive or go far to buy groceries, many get their daily meals from a local convenience store.

With such a large senior market, Japan’s youth segment is often overlooked though their consumption spending has increased. Young adults who live alone or with roommates do not cook and almost exclusively eat out. “Due to a busy lifestyle, these young people want to avoid the hassle of cooking at home. The rise of the working, single-person households is correlated to the rise in sales of ready-made, frozen, take-out, delivery, and restaurant-prepared meals,” the report says.

Recent food trends in Japan

Major trends of relevance in Japan include burgeoning demand for private brands, healthy and functional foods, and for time-saving foods (e.g. frozen foods).

There has been strong growth in the area of prepared foods, particularly home meal replacements (HMR), in the past few years, with offerings increasing in every retail area and a 13% rise in HMR consumption.

Frozen foods have a large presence in the HMR market. In response to an ever-increasing desire for convenience and value-priced food, sales of frozen food in Japan have been rising at about 3.3% annually. Frozen vegetable imports increased to a total of 142 billion yen in 2013.

Changes in Japan’s retail food sales

According to the report, the Japanese retail food industry experienced growth in all of the three major categories in 2014: large scale and conventional supermarkets, department stores, and convenience stores. Total retail sales including food, beverages, general merchandise, fabrics, apparel and accessories amounted to 69,911 billion yen in 2014, with food and beverages – which accounted for 65% of the total  – seeing a significant increase.

Total Retail Sales (Billion JPY)

How large-scale and conventional supermarkets are evolving

The report says Japan’s supermarket business is considered saturated for standard large-scale and conventional supermarkets. So as to better compete with convenience stores, many major supermarket chains are investing in city-style stores (smaller versions of supermarkets located in city centres) which allow easier access and “have been a hit with the elderly population, mothers, and value-conscious customers.”

As the Japanese market continues to mature, the two national brands AEON and Seven and I Holdings have strived to appeal to the aging population. In 2014, the Japanese retail group AEON announced it would triple the number of its “Akore” city-style stores in Tokyo, Saitama, and Chiba from 90 to 250 by 2016.

And in October 2014, AEON’s private brand TopValu expanded to include organic products. “AEON has recently taken to promoting healthy food and local community activities in order to appeal to the rapidly evolving mature and health-conscious market,” the report says.

Convenience stores thriving

Despite the growth of online shopping and a tax hike of 2014, convenience stores continue to be a major retail competitor.

They have continued to increase their market share thanks to their numerous locations and wide variety of products, with a major contributing factor to their success being their proximity to consumers’ homes. Some also offer home delivery, such as Seven-Eleven’s Seven Meal bento delivery service.

Department stores reinventing themselves

Department stores have had to employ new techniques and strategies to stay on top. For example, in December 2014, Matsuya president Masaki Akita announced stores would be hiring more foreign language speakers in order to draw in visitors from abroad. Tourists make up a large percentage of department store customers.

While department stores have seen a significant drop in profits from non-food products in the last decade, those from food products have actually risen due to their premium nature and the popularity of depachika, the ‘wonderlands of food’ found on the basement floors of department stores.

The report says department stores usually carry imported, branded food products though typically in small quantities. “Many of the items are packaged as take-out products due to the proximity to train stations and the premium nature of the products means they are often used as gifts.”

Online shopping a hit with seniors

E-commerce and m-commerce are both expected to grow in the coming years with same-day delivery services and social media awareness. Seniors are some of the most active online shoppers.

Online sales are still relatively small yet have been growing at double digit rates, dwarfing the growth of Japan’s retail market overall. While the majority of sales are for non-food items, food and beverages account for 13.7% of e-commerce sales and are increasingly bought online.

Online shopping remains a lucrative market for grocery stores with some offering home delivery for little to no charge, an option popular with seniors.

“Many major supermarkets now offer online grocery services in most parts of Japan, including rural areas. The most successful has been Ito-Yokado, whose sales grew 14.3% in 2012 with the introduction of online groceries.”

The might of mobile-driven commerce  

Many online vendors are offering m-commerce as a way to connect with mobile users, often by offering mobile-friendly versions of their site, phone apps, and special downloads for customers on-the-go.

“Rakuten is a big name in m-commerce, receiving as much as 52.2% of its total value of transactions via mobile devices in the fourth quarter of 2013, while PC driven sales fell by 8%. It is worth mentioning that food and beverage sales make up 49.2% of Rakuten’s total sales. Popular items include heavy, bulky items that are hard to transport and fresh produce.”

Food procurement by Japanese retailers

The report says that when it comes to sourcing food, Japan’s large-scale supermarkets still rely primarily on importers and wholesalers. Most are engaged to some degree in developing and maintaining private labels which they tend to outsource to food processors.

The giant, nationwide supermarket chains such as Aeon and Ito-Yokado purchase their food primarily through three channels: directly from importers, directly from manufacturers and processors, or via wholesalers and distributors. Wholesalers and big trading houses are generally interested in handling high volume products, not niche-oriented ones, it advises.

Conventional supermarkets purchase through similar distribution channels, although they mainly purchase from wholesalers, whereas the major national chains rely on more direct routes. Department stores, meanwhile, procure food items almost entirely through wholesalers and tenant merchants (who mainly purchase the ingredients for their products from wholesalers and then manufacture the products to be sold).

Convenience store chains use trading companies or wholesalers, depending on the type of product. Their management systems present the most significant challenges for imported packaged processed foods, the report says, because they require exporters to modify product taste/specifications to Japanese tastes, cut delivery times to ensure freshness, and update and introduce new products frequently.

Food exports to Japan

Japan’s food self-sufficiency rate has been declining due to the aging farm population and is only 39%, meaning there are obvious opportunities for suppliers from other countries.

It also helps that since the Fukushima nuclear reactor incident cast doubt over the safety of some domestic produce, Japanese consumers have been more open to imported food.


As can be seen in the pie chart above, the US enjoys a commanding lead among countries exporting food to Japan, helped by Japanese consumers’ preference for US goods, the report says.

Read the full USDA GAIN report: Japan Retail Foods

Main image: “Depa-Chika” at Lotte Department Store by ayustety – http://www.flickr.com/photos/ayustety/12482886/, CC BY-SA 2.0 https://commons.wikimedia.org/w/index.php?curid=12013829

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The TPP and fruit & vegetable trade

The TPP agreement grants new and enhanced market access in Japan, Vietnam, Malaysia, New Zealand and Brunei, countries with which the US does not currently have a free trade agreement (FTA). It also expands market access into Canada, which already has an FTA with the US.

How the Trans-Pacific Partnership (TPP) will affect trade in various fruits and vegetables is covered in a recently updated report by the USDA Foreign Agriculture Service.

The agreement, concluded on October 5 this year, is between the United States and Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam.

The TPP agreement grants new and enhanced market access in Japan, Vietnam, Malaysia, New Zealand and Brunei, countries with which the US does not currently have a free trade agreement (FTA). It also expands market access into Canada, which already has an FTA with the US, the report says.

Tariff reductions are a core element of the TPP, under which countries have committed to “provide substantial market access for the US by either phasing out most tariffs (many immediately), enacting meaningful tariff reductions, or allowing a specific quantity of imports at a lower duty (generally zero) where tariff elimination is not possible.”

“The benefits of the TPP agreement will occur through a combination of tariff elimination, tariff reductions, and new tariff-rate quotas (TRQs),” the report says.

The following are details most relevant to trade in fresh fruit and vegetables:

CHERRIES, APPLES, PEARS

In 2014, the US exported $915 million of fresh apples, cherries, and pears to the TPP region and $1.8 billion to the world.

Japan: the 8.5% tariff for fresh cherry imports will be cut in half upon entry into force of the agreement and eliminated in 6 years. The 17% tariff for fresh apples will fall 25% immediately upon implementation and be eliminated in 11 years and the 4.8% tariff on fresh pear imports will be eliminated immediately upon implementation.
Malaysia: the 5% tariffs on fresh apples, cherries, and pears will be eliminated immediately.
Vietnam: the 10% tariffs on apples, cherries and pears will be eliminated in 3 years.
US: tariffs on fresh apples, cherries, and pears, which are as high as 0.3 cents/kg (approximately 0.2% ad valorem equivalent), will be eliminated immediately.

CITRUS FRUIT & JUICES

In 2014, the US exported $881 million of citrus and citrus juices to the TPP region and $1.5 billion to the world.

Japan: tariffs on imported oranges will be eliminated in 6-8 years. It will expand the season when tariffs are lower from June-November to April-November. During the transition period, there will be a safeguard during the December-March high-tariff season. Japan’s current orange juice tariffs will be eliminated in six-11 years. It will also eliminate its 10% duty on grapefruit over 6 years. Japan’s tariff on lemons is already fixed at zero.
Malaysia: will keep its tariffs on oranges at 0% and immediately eliminate its current 5% tariffs on grapefruit and lemons.
Vietnam: will eliminate in 3 years the current 40% tariff on grapefruit and 20% tariff on lemons. It will also eliminate tariffs on citrus juices, currently as high as 25%, in 5-8 years and eliminate the 20% tariff on oranges in 4 years.
US: will phase out tariffs on oranges, grapefruit, lemons and citrus juices in ten years or less. These tariffs are less than 3 cents/kg for citrus fruits and range up to 7.85 cents/litre for citrus juices.

OTHER FRUITS

In 2014, the US exported $1.6 billion of fruit other than citrus fruits, apples, cherries, and pears to the TPP region and $2.2 billion to the world.

Japan: tariffs, as high as 17%, will be immediately eliminated for many products, including grapes, avocados, strawberries, raspberries, blueberries, cranberries, kiwi, watermelon, and papaya. Tariffs for the vast majority of other products in this category, currently as high as 17%, will be eliminated in 11 years or less.
Malaysia: will immediately eliminate tariffs on the majority of these fruits, which currently face tariffs as high as 30%. Tariffs on tropical fruits, such as bananas and longans, will be eliminated over a 10-year period.
Vietnam: All of Vietnam’s tariffs on these fruits, currently as high as 30%, will be eliminated in 4 years or less. Vietnam’s tariff of 10% on fresh grapes will be eliminated in 3 years.
US: will eliminate tariffs as high as 29.8% in 10 years or less.

POTATOES & POTATO PRODUCTS

In 2014, the US exported $1.0 billion of potatoes and potato products to the TPP region and $1.7 billion to the world.

Japan: tariffs on fresh potatoes, which are currently as high as 4.3%, will be immediately eliminated. Japan’s 8.5% tariff on frozen whole potatoes will be eliminated in six years. Additionally, Japan’s 20% tariff on dehydrated flakes, granules, pellets, flour, meal and powder will be eliminated in six-11 years. In 2014, Japan imported more than $200 million of frozen French fries. Japan will eliminate its current 8.5% duty on frozen French fries in four years and its nine% tariff on “other prepared/preserved frozen potatoes” in six years.
Malaysia: will immediately eliminate tariffs on all potatoes and potato products, currently ranging up to eight%.
Vietnam: will eliminate tariffs on all potatoes and potato products, currently as high as 34%, within six years. It will eliminate the tariff on frozen French fries in four years.
US: will eliminate tariffs on all potatoes and potato products, currently as high as 14%, in zero-10 years.

FRESH & PROCESSED VEGETABLES

In 2014, the US exported $3.9 billion of fresh and processed vegetables (including potato and dried pulses) to the TPP region and more than $5.9 billion to the world.

Japan: will eliminate tariffs for virtually all fresh and processed vegetables. Many of Japan’s vegetable tariffs, currently as high as 17%, will be eliminated immediately as will tariffs on vegetable juices and canned and other vegetable products. These products include fresh/chilled broccoli, fresh tomatoes, fresh celery, fresh asparagus, cabbage, lettuce, chickpeas, garlic and shallots. Tariffs on other fresh and processed vegetables, including fresh sweet corn and onions, will be eliminated in 4-11 years.
Vietnam: will eliminate tariffs, currently as high as 40%, on fresh and processed vegetables in 11 years or less. It will immediately eliminate tariffs on several vegetables including asparagus, Brussels sprouts, cauliflower, celery, ginseng, peppers, and spinach.
Malaysia: will immediately eliminate tariffs, some of which are 90% or higher, on all fresh and processed vegetables.
US: will eliminate tariffs, currently as high as 29.8%, on all fresh and processed vegetables in 10 years.

Image: “Leaders of TPP member states” by Gobierno de Chile – 14.11.2010 Gira a Asia. Licensed under CC BY 2.0 via Commons

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Japan plans fully robotic lettuce farm by 2017

Capable of supplying 30,000 heads of lettuce a day, Japanes company Spread says its 4,800m2 ‘large-scale vegetable factory’ will be “fully automated from seeding to harvest.”

Kyoto-based firm Spread plans to open what has been dubbed the world’s first fully robotic farm.

Capable of supplying 30,000 heads of lettuce a day, the company says its 4,800m2 ‘large-scale vegetable factory’ will be “fully automated from seeding to harvest.” This complete automation of the cultivation process will slash labour costs in half, it said in a press release.

Focused on global expansion, Spread hopes to extend its production to 500,000 heads of lettuce per day in five years “and will continue to expand our vegetable factory business domestically and internationally.”

Founded in 2006, in Kameoka in Kyoto, Spread already operates what it calls the world’s largest vegetable factory using artificial lighting, which grows four types of lettuce for a total 21,000 heads per day. It provides year-round supply to about 2,000 stores in the Tokyo metropolitan area and the Kansai region via the brand “Vegetus”.

Spread produces several types of lettuce under the brand name “Vegetus” (its brand for vegetables cultivated in its vegetable factories) and says it sells them to department stores, major grocery stores, hotels, restaurant, and amusement parks around Japan.

Construction of the vertical farm – at a full investment of up to about 2 million yen (€14.6m) – is due to start in Kizugawa, Kyoto, next spring with the first shipments in summer 2017. From the estimated production capacity of 10 million heads of lettuce a year, Spread estimates annual sales of about 1 million yen.

Environmentally friendly features of the ‘next-generation’ factory are to include recycling of 98% of the water used for cultivation and a system of environmental control making the factory extremely energy efficient.