Food Processing Ingredients

An Expert's View about Food , Beverages and Tobacco in Japan

Posted on: 12 Jan 2012

The Japanese food processing industry was valued at US$255 billion and demand for processed food products should continue to grow for the foreseeable future.

THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Required Report - public distribution Date: 12/21/2011 GAIN Report Number: JA1525 Japan Food Processing Ingredients Food Processing Sector Approved By: Steve Shnitzler, Director ATO/Japan Prepared By: Sumio Thomas Aoki, Senior Marketing Specialist, Paul Miyamoto Intern Report Highlights: The Japanese food processing industry was valued at US$255 billion or 22.6 trillion yen in 2010. Key market drivers such a strong health consciousness, growth of an aging population, and more women in the workforce have led to personalization of product packaging as well as greater demand for convenience and ready-to-eat foods. These factors indicate that demand for processed food products should continue to grow for the foreseeable future. Post: Tokyo ATO I. MARKET SUMMARY A. Overall Market Summary The value of the Japanese food processing industry was estimated at US$255 billion in 2010, only a small uptick of .86% from 2009. Despite the recession and sub-normal performance of the economy, the food processing industry has done relatively well. Products that contribute to home cooking or ready-to-eat options have experienced growth. Several product categories sold well in 2010 compared to 2009, mostly due to the Northeast Earthquake and Tsunami. Most notably, canned/bottled products, bottled water, juices, processed meats, processed seafood, retort packaged products, and frozen foods increased. While the economy has been stagnant, the food processing industry is viewed as a stable and growing industry within Japan. The exchange rates used in this report are 104.46 yen/$ for 2008, 94.57 yen/$ for 2009, and 88.81 yen/$ for 2010. Figure 1a. Japan Food Processing Industry 2010 2011 estimates change very slightly from 2010. Beverages were predicted to increase .2%, fats & oils +.3%, wheat flour +.3% which reflect the increasing cooking and consumption in the home. Figure 1b. Japan Food Processing Industry 2011 Estimate Source: Shurui Shokuhin Tokei Geppo (酒類食品統計月報), January 2011 and Special Edition: New Stage (新ステージの幕開け), which were both published by Nikkan Keizai Tsushinsha (日刊経済通信社) B. Domestic Companies The Japanese food processing industry is dominated by 15 major companies, making up almost 50% of the market sales in 2009, with the largest company, Kirin Holdings Co., Ltd., claiming a 10% market share. Appendix A provides a table of the top 50 Japanese food processing companies with their net sales, end channels, production locations, procurement channels, and contact information. This table has been included to provide you with a more detailed image of the current food processing industry in Japan. C. Key Market Drivers Key market drivers for the food processing sector include: * A deflationary economic environment over the past decade, causing processors to seek out lower cost food inputs and international processing options in order to remain competitive. * Increasing interest in health and functional foods with an emphasis on the growing aging population. * Increasing emphasis on convenience, ready-to-eat, and value-priced foods. * Continued diversification of the Japanese diet. * Personalization and individualization of food and food marketing. * Larger focus on the demographic of twenty to thirty year olds. * Heightened consumer and retailer food safety concerns. D. U.S. Involvement in the Industry As the United States is currently the largest supplier of agricultural products to Japan, with a market share of approximately 27.4% and export value worth approximately $13.9 billion, U.S. products and ingredients have a large presence in the market. Competitors of the United States as suppliers to Japan are China (11.6%), Australia (8.4%), and Thailand (7.5%). Value ($ Million) % Share Rank Country 2008 2009 2010 2008 2009 2010 1 United States 16,983 12,974 13,862 31.61 29.25 27.37 2 China 5,146 5,160 6,021 9.58 11.63 11.89 3 Australia 4,635 3,806 4,232 8.63 8.58 8.36 4 Thailand 3,628 2,959 3,785 6.75 6.67 7.47 5 Canada 4,280 3,165 3,503 7.97 7.14 6.92 6 Brazil 2,407 1,809 2,380 4.48 4.08 4.7 7 Indonesia 1,475 861 1,547 2.75 1.94 3.05 8 France 1,490 1,228 1,307 2.77 2.77 2.58 9 New Zealand 1,304 1,142 1,287 2.43 2.57 2.54 10 Philippines 1,068 1,193 1,069 1.99 2.69 2.11 World Total 53,729 44,353 50,652 100 100 100 Source: Global Trade Atlas E. Some key advantages and challenges for U.S. food products include: Advantages Challenges The U.S. has a reputation as a reliable Consumers perceive Japanese food production supplier of food inputs in terms of availability as safer than production overseas, including the and delivery. United States. U.S. manufacturers produce many specialty Making available detailed information to the food products that are attractive to Japanese most appropriate purchaser and company can consumers. be difficult in Japan. Many Japanese love American culture. Getting your product and product information to the purchaser and consumer is a challenge. F. Developments within the Industry Recently, in an effort to reduce costs, an increasing number of Japanese food processors have been going off-shore to source processed food items; when traditionally, these products would be produced and processed domestically. For example, Ajinomoto Frozen Foods, the fourth largest frozen food company, has seven overseas manufacturing plants. Nippon Ham, the largest meat processor in Japan, has joint ventures in Thailand, Australia, Mexico and the United States. Many Japanese companies continue to invest in China to produce frozen vegetables and processed frozen foods specifically for the Japanese market. It is becoming a very common practice to import ingredients and maintain licensing, processing, and packing privileges in Japan. II. MARKET STRUCTURE & ENTRY A. MARKET STRUCTURE The Japanese market structure and distribution system is different from that of the U.S. and thus a thorough understanding of its mechanics before entering the market is essential. The following illustration is a basic flowchart showing how U.S. products would enter and move through the Japanese distribution system. The traditional system looks like this: Source: ATO Tokyo Your product will most likely be handled by a: 1. General trading company 2. First-line wholesaler 3. Second-line wholesaler 4. Retailer, HRI or food processor Trading companies provide the following services: 1. Legal importer 2. Financier 3. Customs clearance 4. Warehousing 5. Order and shipping documentation In the past, trading companies would normally sell to first-line wholesalers, who would then sell product to secondary distributors. This pattern has changed in the past decade as companies seek to reduce logistical costs. Large food processors and retailers are now purchasing sizeable quantities of product directly from trading companies. In some cases, the HRI and retail sectors are choosing to directly import items themselves if the size of the transaction makes it cost effective, as displayed in the graph above by the dotted line from U.S. exporters to retailers and HRI. These HRI importers are often large family chain restaurants, kaiten (conveyer belt) sushi restaurants, and regional restaurants. Often times, the importer or trading company needs to also add value through special processing, designing, or packaging. These transactions circumvent the usual second-line wholesalers and distributors, but in these tough economic times wholesalers and trading companies realize traditions need to be circumvented. B. MARKET ENTRY The Japanese market is unique from other markets in Asia and can be a complicated market in which to enter. There are many factors to consider before entering this market, specifically the strict regulations on specific ingredients and additives. Despite this, the Japanese market is still one of enormous potential. With the changing population, demand is shifting and new opportunities are presenting themselves. These trends are discussed in the later sections of the report. Strategies for entering the Japanese market will vary depending on product characteristics, competition, and the market environment. Tools such as The Market Assessment Checklist are an effective way in which to begin the process of evaluating your product’s potential within the Japanese market. The Market Assessment Checklist can be found at: For further guidance and a more detailed outline of the variety of resources available to U.S. exporters, please refer to Appendix B. III. BEST PROSPECTIVE PRODUCTS A. ESTABLISHED PRODUCTS 1. Pork Pork demand remains high due to the ongoing restrictions on U.S. beef. The HRI and retail sectors offer dishes like pork bowl and pork barbecue as an alternative to traditional beef menus. Imported frozen pork cuts from Canada, United States, and the EU are mainly used as raw materials for ham, bacon, and sausage products. Danish frozen belly cut is a mainstay for bacon, while U.S. frozen picnic cut is used to make sausage. Japan also is a major importer of seasoned processed pork and this processed meat is often used in prepared and ready-to-eat foods such as bento lunch boxes as well as in the restaurant sector. While the import demand for frozen pork cuts for ham, bacon, and sausage products has remained stable in recent years, the growth prospect for Japan's prepared and ready-to-eat sector remains strong. 2. Surimi, Roe, and Urchin Japan is a major market for U.S. surimi, roe, and urchin roe. Other fish that show potential in Japan are salmon roe, cod roe, and herring. 3. Processed Fruits & Vegetables The U.S. has competitive advantages in higher value-added products such as fruits and vegetable purees and pastes as well as a variety of mixed vegetable assortments. The United States also has competitive advantages in potatoes, corn, peas, carrots, and various berries. Overall imports of processed fruits and vegetables were one of the few agricultural sectors to experience an increase in the last few years. Most of the gain has been from China. 4. Soybean The United States is a dominant supplier of soybeans to Japan for uses in traditional food items such as soy sauce, tofu, miso (soybean paste) and natto (fermented soybeans). Soymilk products have also been expanding at a rapid rate in Japan. Note that these soybeans for food use are not GMO and must be identity preserved (IP). 5. Fruit The U.S. is a leading supplier of quality and price competitive citrus fruits such as grapefruits, lemons, and oranges. Other fresh fruits have also remained consistent or have experienced minor growth over the last year including strawberries, which are used in cakes during the off-season in Japan. While strawberries have been a mainstay as a cake ingredient, this is also changing as the confectionery industry is experimenting with other fruits such as figs. American cherries are also popular for the retail market and many supermarkets plan promotions of American products around the import of American cherries. Success of fruit products from one season to another is dependent on the quality of the previous year as well as the expected quality of the new harvest. 6. Tree Nuts The U.S. is a major supplier of almonds, walnuts and pistachios to Japan. Almonds and walnuts are largely used in confectionery items or covered in chocolate. Consumer awareness of health issues in Japan has helped to increase demand. 7. Wheat The U.S. is the leading supplier of wheat to Japan because of its stable supply and quality. As a result of this, the U.S. consistently holds a market share of above 50% in terms of volume. Wheat is a staple in the Japanese diet and is used for noodles, baked goods, confectionery products, and a variety of other items. 8. Health and Functional Foods Health related functional foods experienced decreases in FOSHU (Foods for Specified Health Use) approvals and sales in 2009. FOSHU is the Japanese regulation system that was put into place in the 1990’s to regulate the growing market of functional foods. Though the Ministry of Health, Labor, and Welfare (MHLW) oversees the FOSHU regulatory process, the process is administered by the Japan Health Food and Nutritional Food Association. The FOSHU process has become a means for companies, including overseas companies, to make health claims about their product. While the number of approved FOSHU products has continued to grow along with its sales since the institution’s founding, 2009 was the first time a decline was experienced in both categories. The Japan Health Food and Nutrition Food Association reported a sales figure of $5.81 billion (549.44 billion yen) for FOSHU items in 2009, a decline of $1.38 billion (130.4 billion yen) from 2007. (Note: 2010 data are not yet available.) Sales of FOSHU Items (2009) Sales of FOSHU Items (2009) Type Billions of Yen Million of US$ Lactic Acid Bacteria 292.56 3,093.58 Dental Caries Related 51.2 541.40 Blood Sugar Related 21.59 228.30 Lipid Metabolism 106.71 1,128.37 Dietary Fiber 10.46 110.61 Minerals 19.26 203.66 Blood Pressure Related 20.82 220.15 Oligo Saccharides 3.4 35.95 Cholesterol Related 23.44 247.86 Total: 549.44 5,809.88 Source: Japan Health Food and Nutritional Food Association, 2009 B. SECTOR TRENDS AND PRODUCTS WITH GOOD SALES POTENTIAL At the consumer level, the following trends are driving the way food processors are marketing their products. 1. Health and Functional Foods The official definition of functional foods and drinks in Japan is "foods which are expected to have a specified effect on health due to the relevant constituents or foods from which allergens have been removed." Functional ingredients such as dietary fiber, oligosaccharides, non-cariogenic sweeteners, calcium, iron, mineral absorption promoters, beta-carotene, chitosan, specified soy protein, collagen, polyphenols, lactic acid bacteria cultures, soy iso-flavones and germinated brown rice (GABA) have been included in functional foods marketed in Japan. Examples of functional foods include yogurt with lactic bacteria to help digestion and candies with collagen to target skin health. Also, breads with added wheat germs are another functional food. In addition to these specialty functional foods, there has also been growing popularity in traditional health foods such as soy milk, which has increased due to its perceived health benefits. Diet conscious consumers have been switching from sugar, soft drinks, cakes and ice creams to low calorie teas, mineral water, as well as fruit and vegetable juices. Tree nuts, especially almonds and walnuts, are also becoming popular. Snack foods are an area that is truly evolving in terms of health. There are limited snack bar and on-the-go snack options in Japan that specifically target health. While products like Soy Joy have begun to pioneer the path, there is still opportunity in introducing health-based snack products such as low-calorie nutritional bars, energy bars, and processed fruits and vegetables snacks. Many of the health bars and snack options on the market are targeted towards men or athletes and the few low-calorie options that do exist for women are very expensive. The major distribution line for these snack products is through convenience stores, where sales are split between Otsuka Pharmaceuticals, the makers of Soy Joy and CalorieMate, and Asahi, which produces a cereal bar. Affordable health snacks and nutritional bars, both low-calorie and otherwise, have significant potential in this market. In an effort to avoid the high volume, competitive market of convenience stores sales, another recommended entry point is through high-end coffee shops or hotels. 2. The Aging Population Japan is in the midst of a major demographic change. Much like the trend that will also hit the United States in the next couple of decades, the percentage of young people has been shrinking since the 1980’s, and the aging population has been growing. By the end of this decade, there will be three pensioners for every child under 15 in Japan. This significant change is creating a substantial new market with new demands. Many domestic firms in Japan have begun the process of creating product lines that cater to the physical and dietary needs of this aging population. These companies claim that products in the market need improvement in the areas of taste, texture, and price. Raising the quality and lowering the price of these products is the current goal of manufacturers and thus many are demanding new purees, specifically meat, fish, vegetable, and fruit, to add as the bases for their soft foods. As Japan is just the first of many postindustrial nations to experience this trend, the food technology that is pioneered here and now will be the same technology that will cater to the aging population in other nations in the future. 3. Growth of Convenience Foods The fast paced Japanese lifestyle has led to the growth of processed foods as a replacement for meals made from scratch at home. The best example is the rapid expansion of convenience (conbini) store chains over the past decades, which specialize in a large variety of prepared meals. Examples of prepared meals are traditional bento lunch boxes, onigiri (rice ball), pasta dishes, sandwiches, salads, baked goods, and desserts. Ingredients such as low-cost processed vegetables to be added to bento lunches or as ingredients in very popular snack foods such as korokke, a breaded and fried potato or meat patty, are in high demand. Additionally items such as lunch meats and fruit or nut ingredients for confectionery use are also in demand. With over 42,000 convenience stores in Japan, these prepared food options are major competitors with fast-food chains. Major fast food companies describe these “conbinis” as competition because they are located in subways and thus are easy to access on lunch breaks and before dinner, they are open 24 hours, and the meals are inexpensive, tasty, and fresh. In addition to these pre-made meals available at convenience stores, processed and packaged convenience food is also becoming very popular. Over the last 7 years, there has been a decline in restaurant dining as many Japanese are looking for less expensive options. In addition to this, young Japanese are marrying later which has lead to more Japanese cooking for one and thus looking not only for freshly prepared meals to grab on the go but also easy to make meals at home. Packaged sauces, meals in-a-box, instant meals, and other easy to make options are growing in popularity and it is this sector of easy home cooking which will continue to grow. 4. Diversification of the Diet The trend toward diversification continues and every year new "hit" food items based on foreign products make their mark on the Japanese diet. Examples over the past half-decade include pasta, pizza, olive oil, tiramisu, cinnamon buns, Belgian waffles, donuts, and scones. More importantly, the trend toward internationalization of the diet is clearly reflected in the growing presence of restaurants in Japan featuring ethnic food. From the United States, names such as McDonald's and KFC have long been prominent and their popularity continues to grow with the current economic situation. The most recent example of a major success for U.S. food is in coffee shop chains such as Starbucks and Tully's. They have introduced new products such as flavored coffees, which are extremely popular, as well as new dessert options and wrap sandwiches. The internationalization of the Japanese diet offers U.S. exporters an opportunity to supply ingredients to meet this increasing demand. 5. Value Pricing The deflationary environment of the past decade has caused consumers to be more cost conscious within their food budget. Fast food locations as well as almost all mid-range restaurants have promoted low-priced value sets, which has led to intense competition among food service and retail operators. This, in turn, is causing food suppliers to seek lower cost inputs in order to provide more competitive prices to their customers. On the other end of the value pricing spectrum, consumers are also looking for gourmet food items without the high price tag. Consumers are looking for elegant, stylish meals that are easy to prepare at home. Ingredients for semi-homemade or frozen meal options thus have potential in this market. 6. Breakfast Traditionally, breakfast has been eaten at home at the kitchen table. External changes to the Japanese lifestyle have led to the growing need for on-the-go breakfast options. As more women enter the workforce and as young Japanese begin to get married at an older age, there has been a significant move toward eating fast, easy, and inexpensive. This growing trend of convenient on- the-go breakfast products can be seen in almost every office building as the workday begins, as people now bring their breakfast to work. Items such as hearty instant cup soups, breakfast bars, and granola are stepping in as filling substitutes for the traditional sit down meal. While some bring these items from home, many Japanese are picking their breakfast up as they go. The McDonald’s breakfasts, given the name asamaku, (literally: morning McDonald’s) as well as other fast food breakfast items have become increasingly popular, mainly for their convenience, price, and the variety of hearty options. Even such items as muffins and morning pastries are becoming more popular as a result of the growing Western influence of coffee shops. But while these sweeter breakfast items are growing, more savory foods and filling food items are preferred in the morning by both men and women. 7. Individuality and Personalization As has occurred in the U.S. in recent years, the Japanese are experiencing similar levels of individualization and personalization especially within consumer products. Each member of the family has their own needs and preferences and the Japanese consumer is beginning to personalize their spending to make sure each individual is satisfied. This type of personalization is normal in hygiene products such as shampoo but has also started to seep into the food and processed food world. Many companies have created product lines with each specific family member in mind. Specifically taking into account differing preference for packaging, texture, and health; and these more personalized food products have done well. Products such as snack foods, frozen dinners, soft drinks and juices, and confectioneries have particularly benefited from this new trend. For instance, there are many alcoholic drinks that are targeted specifically to young women. While this personalization trend is becoming more and more common, it must be kept in mind that space is limited inside the Japanese home. Refrigerators, cabinets, and food storage areas are small, as reflected in the packaging of almost all Japanese food products. 8. Twenties and Thirties While most food items have been introduced with a target demographic of homemakers, mainly women in their forties, there has been significant growth in food items targeted toward men and women in their twenties and early thirties. As the number of women in the workforce has grown, the age at which people are getting married is pushed back further. This trend coupled with more and more young professionals living outside their parents’ homes has resulted in a new demographic, especially for processed foods. These twenty and thirty year olds are looking for single portion meals that are easy to prepare and that fit their lifestyle. Products that are starting to appear are single serving pasta meals, where the directions are simple, the packaging is sleek and modern, and the pasta sauce choices available are gourmet in nature. These products use edgy advertising and often television commercials and celebrity endorsements to capture their audience. Packaging is a large portion of marketing to this demographic, which responds well to bright colored packaging with simple and modern themes. For example with wine, twenty and thirty year olds have basic knowledge about wine but not enough to differentiate quality. Much of the decision- making is based on price. Instead, when making a selection, it is a reasonable price (less than $10.00) and a brightly colored label with a bold slogan or interesting graphic that influences the purchase most. This new demographic has been receiving a great deal of attention because of their decisiveness in what they like, their willingness to spend money on what they like, and their brand loyalty. 9. Beauty and Anti-aging Beauty and anti-aging products have always been popular in the Japanese market, yet have remained mainly within the areas of cosmetics and pharmaceuticals. Along similar lines as functional foods, beauty and anti-aging is becoming a new marketing tactic within a growing aging population. This trend is showing large potential in the area of processed foods. While one approach is to educate the public on the natural anti-aging effects of some processed fruits and vegetables as well as juices, other companies have started to add anti-aging ingredients, such as collagen, to candies, beverages, and snack foods. The addition of these beautifying and anti-aging ingredients to food is becoming very popular among women of all ages. While this portion of the industry continues to grow, Japanese regulations surrounding health claims are extremely strict. If you are looking to make beauty or anti-aging claims, please contact ATO Japan for information and ways to navigate this challenging set of Japanese regulations. 10. Food Safety Japanese consumers are sensitive to food safety issues. Many Japanese food processors demand that suppliers follow strict quality assurance procedures, including HACCP systems and traceability to the point of origin of the ingredients. Japanese consumers are responsive to two concepts – Anzen – of safety, and – Anshin – peace of mind. It’s not enough for consumers to feel that product is safe, they demand that foods promote a peace of mind that is internalized. Merchants and retailers can always promote anzen, safety, but only time and reputation can bring on the feeling of anshin. C. PRODUCTS NOT PRESENT BECAUSE THEY FACE SIGNIFICANT BARRIERS 1. Items Containing Prohibited Ingredients or Excess of Allowable Limits Because of the strict Japanese regulations on food additives, some U.S. food products containing prohibited additives or excess amount of allowable limits cannot enter Japan. It is highly recommended that U.S. exporters check their product compliance as a first step when considering business in Japan. Contact ATO Japan at For more information on food additives, please refer to JETRO’s Specifications and Standards for Foods, Food Additives, etc. Under the Food Sanitation Act (2008) 2. High Tariff Rate Products/Quota Restricted Items A variety of dairy products such as butter, edible non-fat dry milk and whey products, cheese, yogurt, and other dairy products are subject to TRQ/high tariffs. Likewise, sugar and rice face very high tariff rates. It is wise to check the tariff rates as well as quota restrictions for your classification of product. Quotas still exist on some items such as dry beans. Refer to the latest Japan Customs’ tariff schedule: (April 2010). 3. Quarantine Restricted Items Numerous fresh produce products are prevented from entering Japan due to the Japanese plant quarantine regulations. For example, fresh potatoes are prohibited to import. The list of prohibited produce items can be obtained from APHIS, Tokyo at (011-81-3) 3224-5111 as well as through ATO offices in Japan at V. POST CONTACT AND FURTHER INFORMATION For those with questions or seeking additional assistance, please contact the U.S. Agricultural Trade office (ATO) in Tokyo or Osaka at the following addresses: ATO Tokyo U.S. Embassy 1-10-5, Akasaka, Minato-ku, Tokyo 107-8420 Tel: 81-3-3224-5115 Fax: 81-3-3582-6429 E-mail address: ATO Osaka American Consulate General 2-11-5, Nishi Tenma, Kita-ku, Osaka City, Osaka 530-8543 Tel: 81-6-6315-5904 Fax: 81-6-6315-5906 E-mail address: ATO Japan has begun a series of regional reports to provide specific information on major regions in Japan. Please go to and click on “Regional Briefs”. To date, the ATO has reports on the Kansai region (Osaka/Kobe), and the Chugoku region (Hiroshima). Reports on Hokkaido (Sapporo), and Kyushu (Fukuoka/Kagoshima) will be available soon. Websites:,, Note: It is recommended that U.S. exporters verify relevant import requirements with their foreign customers, who normally have the most updated information on local requirements, prior to exportation. Final import approval of any product is subject to the importing country's rules and regulations as interpreted by border officials at the time of product entry. VI. APPENDIX A. COMPANY PROFILES Net Sales Company (US$ billions at End- [i] Procurem(Main $1=88 ¥ ) User Product (¥=millions) Channe ent Address Phone# Website Types Channels ) ls Kirin Holdings 2-10-1 Co., Ltd. $24.75 Shinkawa 1 (Beer, ¥2 Importers, ,177,802 Retail/H RI Chuo-ku, 03-5541-5321 Direct Liquors, (Dec. 2010) Tokyo Wine, & 104-8288 Foodstuff) S 2-1-40 untory Dojimaha Ltd. $19.80 ma (Liquors, 6-1131 2 B ¥1 Retail/H Importers, ,742,373 eer, Soft RI K 06-634 ita-ku, Direct D (Dec. 2010) Osaka rinks, & W City 530-ine) 8203 Meiji Holdings (Dairy, B 1-2-10 everages, Fr $12.66 Shinsuna ozen 03-3273-4001 3 Foo ¥1 Retail/H Importers, ,114,095 ds, RI D Koto-ku, irect P (Mar. 2010) Tokyo rocessed Foo 136-8908 ds, & Baby Foods) Asahi B 1-23-1 reweries, Azumaba Ltd. $10.95 608-51112 4 (Beer, ¥963 Retail/H Importers, shi 03-5,270 RI Direct Sumida- Liquors, (Dec. 2010) W ku, Tokyo ine, & Foo 130-8602 dstuff) Maruha 1-1-2 Nichiro $9.36 Otemachi 03-6833-0826 5 Holdings ¥823,399 R Importers, etail D Chiyoda- http://www.maruha-irect (Marine (Mar. 2010) ku Tokyo Products) 100-0004 Nippon Meat P 3-6-14 ackers. Minami- Inc. $7.60 (Beef, R Honmachi etail/H Importers, 6 P ¥668,973 ork, RI Chuo-ku, Direct C (Mar. 2010) Osaka hicken, H City 541-am, S 0054 ausages, & Deli) Ajinomoto 1-15-1 Co., Inc. $7.55 R Kyobashi etail/H Importers, 7 (Amino ¥664,661 A RI Chuo-ku, 03-5250-8111 Direct cids, (Mar. 2010) Tokyo Instant 104-8315 Bouillon, & Sauces) Yamazaki B 3-10-1 aking Co., Iwamotoc Ltd. $6.99 03-3864-3111 , ho 8 (Breads, ¥615 Retail/H Importers,151 C RI D irect Chiyoda- onfection (Dec. 2010) ku ndex.html , Tokyo ery, Jam, & S 101-8585 pread) Megmilk Snow Brand Co., Ltd 13 (Milk, Y Honshio-ogurt, $5.73 9 P Retail/H Importers, cho 03-6887-3690 http://www.meg-udding, ¥504,223 Fun RI Direct Shinjuku- ctional (Mar. 2010) D ku, Tokyo airy P 160-8575 roducts, Fruit & Vegetable Juices) Morinaga Milk 5-33-1 Industry $5.05 Shiba 1 C ers, 03-3798-0111 o., Ltd. ¥444,593 Retail/H Import 0 RI D Minato-irect (Dairy, (Mar. 2010) ku, Tokyo Baby 108-8384 Foods) Net Sales (US$ billions at Company End- $1=94 [ii] .57 ¥ ) User Procurem (Main Product (¥=m ent Address Phone# Website illions) Types Chann) el Channels s Nichirei C 6-19-20 orporation $4.98 -2101 1 (Frozen & Retort R Tsukiji 03-3248etail/H Importers, ¥437,808 1 Processed Foods, RI Chuo-ku, Direct C (Mar. 2009) Tokyo h dex.html icken, Pork, B 104-8402 eef, & Fish) Nisshin Seifun Group Inc. 1-25 (Flours, Pastas, Kanda $4.82 1 Pasta Sauces, ¥424 Retail/H Importers, Nishikicho 03-5282-6666 ,156 2 Rehydratable RI Direct , Chiyoda- Noodles, Fr (Mar. 2009) ozen ku, Tokyo Foods, & 101-8441 Beverages) S 4-20-1 apporo Holdings $4.42 Ebisu 1 (Beer, Liquors, ¥389 Retail/H Importers, ,244 3 Soft Drinks, & RI D Shibuya- 03-6694-0002 irect W (Dec. 2008) ku, Tokyo ine) 150-8522 4-27 Takahatac Itoham Foods Inc. $4.36 ho 1 (Beef, Pork ¥383 Retail/H Importers, ,925 4 Chicken, Ham & RI Nishinomi 0798-66-1231 Direct S (Mar. 2009) ya City, ausages, & Deli) Hyogo 663-8586 C 7-9-66 oca-Cola West Hakozaki Japan Co., Ltd. $4.27 Higashi- 1 (Beverages, ¥375,764 Retail Direct ku, 092-641-8591 5 Functional B (Dec. 2008) Fukuoka everages, & Fun City 812-ctional Foods) 8650 Nissin Foods $4.26 -28-1 1 Holdings Co., Ltd. ¥374 R 6 etail/H Importers, ,932 S 03-3205-5011 www.nissinfoods-hinjuku 6 (Instant/C RI Direct hilled/Fr (Mar. 2009) S hinjuku- ozen ku, Tokyo Noodles, Instant 160-8524 Soup, & Functional Foods) 7-7-7 Minatoshi $3.88 UCC Importers, ma Holdings 1 ¥341,341 etail/H Direct Nakamac 078-304-8888 (Coffee, Cafés, 7 (M R arch 2010) RI p:// con hi, Kobe, httfectionery) Hyogo 3-47-12 Ito-en Co., Ltd. Honmachi 1 (Tea, Coffee, Fr $3.75 uit il Direct Shibuya- 03-5371-7111 8 & ¥329,631 Reta Vegetable B (Apr. 2009) ku, Tokyo everages) 151-8550 Nippon Suisan K 2-6-2 aisha, Ltd. $3.61 Otemachi 1 (Frozen & Chilled 9 S ¥317 Retail/H Importers, ,216 Chiyoda- 03-3244-7000 eafood, Canned RI Direct Foo (Dec. 2009) ku, Tokyo ds, Retorts, & Fr 100-8686 ozen Deli) Nissin Olio Group 1-23-1 Ltd. $3.47 2 (Cooking Oil, ¥305 R Shinkawa etail/H ,297 03-3206-5005 0 Dressings, RI Direct Chuo-ku, Fun (Mar. 2009) Tokyo ctional Foods, & 104-8285 Soy Milk) Net Sales Compan (US$ billions at y End Procurem-User (Main P $1=88 ¥) roduct T (¥=millions) Channe ent Address Phone# Website ls ypes) Channels Kirin Beverage C 6-26-1 o., Ltd. Jingu- (Coffee, Tea, $3.25 2 Importers Fr Mae, uits Drinks, ¥285,915 Retail/HRI 03-6734-9310 1 Vege Shibuya-table Drinks, (Dec. 2010) W ku, Tokyo ater, & S 150-0001 herbet) Kikkoman 250 Noda, $3.22 2 Corporation Importers, Noda City, ¥283,463 Retail/HRI 04-7123-5111 2 (Soy Sauces & Direct Chiba 278- S (Mar. 2010) easoning) 8601 1-6-41 Shingawa Crystal Square $2.99 2 S 11F, tarzen Group /Dir ¥262,832 Retail/HR ImportI 3 (Mea Kounan, ts) ect (March 2010) M oup.html inato-ku, Tokyo , 108-0075 Otsuka Holdings 2-9 (Functional Foo Kanda-ds, 2 Fun $2.84 Tsukasamctional Retail/Functi Importers, 03-6717-1410 4 B ¥249,489 ach everages, onal foods Direct S C hiyoda- upplem (Mar. 2010) ents, & M ku, Tokyo ilk D 101-8535 rinks) Asahi Soft Drinks Co., Ltd. 1-23-1 (Tea, Functional $2.74 A 03-5608-5331 zumabas 2 & ters, http://www.asahigroup- ¥240,838 Retail/HR ImporI 5 Fr D hi Sumida- irect uit Beverages, (Dec. 2010) ku, Tokyo & index.html Canned 130-8602 Coffee) Kewpie Corporation 1-4-13 (Mayonnaise, $2.54 Shibuya 03-3486-3331 2 Dressings, ¥223,911 R rters, etail/HR ImpoI 6 S D Shibuya- irect auces, Jams, (Nov. 2010) ku, Tokyo x.html Canned Foods, & 150-0002 Health Foods) Toyo Suisan Kaisha, Ltd. (Instant/Chilled/Fr 2-13-40 ozen $2.44 Kounan 2 N Importers, oodles, ¥214,861 Retail/HRI 7 S D Minato-ku, 03-3458-5111 irect eafood, Chilled (Mar. 2010) Tokyo & Frozen Foods, 108-8501 Ham/Sausage, Canned Foods) Nestle Japan Group 7-1-15 (Coffee, Creams, $2.26 Goko-Dori 2 Functional ¥198,500 Retail/HRI Importers Chuo-ku, 078-230-7000 8 Foods, Chilled (Dec. 2010) Kobe City Foods, & Frozen 651-0087 Foods) P 4-12-2 rima Meat P Higashi-ackers, Ltd. Shinagaw (Beef, Ham & $2.23 2 Sausage, ¥196,275 R a etail/HRI Importers 03-6386-1800 9 M Shinagaweat Processed (Mar. 2010) Foo a-ku, ds, & Health Foo Tokyo ds) 140-8529 Coca-Cola C 2-2-1 entral Japan C Minatomiro., Ltd. $2.21 ai Nishi- 045-222-5850 3 (Beverages, ¥ 194,834 Retail Direct ku, 0 Functional B (Dec. 2008) Yokohama ml everages, & Fun City 220-ctional Foo 8141 ds) Net Sales Company (US$ billions at End- (Main $1=88 ¥) User Procureme Product (¥=millions) Channe nt Address Phone# Website Types) Channels ls 20 Tak Naginatabokara H o-cho, Shijo-oldings Inc. Dori (Sake, Wine, $2.16 075-241-5130 3 S Retail/H Importers, Karasuma ho-chu, ¥189,769 1 i-iru, Liquors, S RI Direct Higashoft (Mar. 2010) D S tml himogyo- rinks, S ku, Kyoto easoning) City 600- 8681 Yakult $2.00 1-1-19 03-3574-8960 3 H orters, onsha Co, ¥176,143 R Impetail 2 D Higashi- Ltd. (Mar. 2010) Shimbashi ml (Milk Products Minato-ku, & Tokyo 105- Functional 8660 Foods) J-Oil Mills, Inc. 8-1 Akashi- (Cooking Oil, $1.96 3 Fine Retail/H Importers, cho Chuo- 03-5148-7100 ¥172,041 3 C RI Direct ku, Tokyo hemicals, & (Mar. 2010) H 104-0044 ealth Foods) Nippon Flour M ills Co., Ltd. 3 (Pasta, Pasta 5-27-5 Sendagaya 4 S $1.92 auces, Flou ¥169 Retail/H Importers, ,076 p:// rs, RI Shibuya-ku, 03-3350-2311 htt Direct Fr (Mar. 2010) Tokyo 151-ozen Foo 8537 ds, & Health Foods) Kagome Co., Ltd. (Fruit & 3-14-15 Vegetable $1.87 3 B R Nishiki 052-951-3571 etail/H Importers, everages, ¥164,361 5 Fr RI Naka-ku, http://www. Direct ozen & (Mar. 2010) Nagoya City .html Retort Foods, 460-0003 Sauces, & Soups) Shikishima Baking Co., 5-3 Ltd. $1.78 Shirakabe 052-933-2111 3 (Breads, ¥156 Retail/H Importers, ,205 6 Japanese & RI Higashi-ku, http://www. Direct W (Aug. 2010) Nagoya City x.html estern C 461-8721 onfectioneri es) Mizkan Group Co., Ltd. 2-6 (Vinegar, $1.77 3 S R Nakamura- etail/H Importers, 0569-21-3331 easoning ¥156,100 7 S RI ho Handa D cirect auces, & (Feb. 2010) C http://www.mizkaity, Aichi Chilled 475-8585 Foods) Marunouchi Trust Tower Main, 22nd Calbee $1.77 Floor 3 03-5220-6222 (Potato chips, ¥155 port, ,529 R Imetail 1-8-3 8 Direct snacks) (March 2010) M arunouchi, Chiyoda-ku, Tokyo 100- 0005 1-5-7 Mikuri Yasakae- machi, House Foods Higashi- Corporation Osaka City (Curry Roux, 577-8520 06-6778-1231 (Osaka) 3 R $1.76 etort Retail/H Importers, 03-3264-1231 (Tokyo) 9 R ¥155,136 oux, RI D irect S (Mar. 2010) nacks, & Tokyo Head .html Funct Office ional Foods) 6-3 Kioi-cho, Chiyoda- ward, Tokyo 102-8560 21-3 Midori- $1.73 4 Marudai Retail/H Importers, cho, ¥152,284 0 Foods RI Direct Tak atsuki- (May 2010) shi, Osaka Net Sales Company (US$ billions at $1=88 End- Procureme (Main ¥) User Product (¥=millions) Channe nt Address Phone# Website l Types Channels ) s Kyokuyo Co., Ltd. 3-3-5 (Processe $1.68 4 d Seafood, R Akasaka etail/HR ¥148,009 Direct Minato-ku, 03-5545-0701 1 Frozen I Foo (Mar. 2011) Tokyo 107-ds, & C 0052 anned Foods) Lo 20-1, Nishi-tte (Chew shinjuku 3-ing gum, chome, $1.66 4 choco Shinjuku-ku, late, Retail/HR Importers, ¥145,700 2 cook Tokyo, ies, I Direct (Mar. 2011) candy Japan 160-, ice cream 0023 ) Ajinomoto General 3-20-2 Nishi Foods, $1.65 Shinjuku 4 Inc. ¥144 Retail/HR Importers, ,900 S 03-5302-7500 hinjuku-ku 3 I Direct (Coffee, (Mar. 2011) Tok yo 163- Tea, & 1440 Creamer) Tokyo Coca-Co 2-15-6 la Bottling $1 Shibaura, .63 4 Co.,Ltd ¥143 Retail/HR Manufacture Minato-ku, ,483 4 I syrup (Beve Tokyo rage (Mar. 2011) s, soft drinks) Ezaki Glico Co., Ltd. 4-6-5 (Ice Utajima Cream, $1.61 4 R R Nishi 06-6130-5914 etail/HR Importers, etort ¥141,564 Yodogawa- Group Procurement Center (Kitaku) 5 Foo I Direct ds, (Mar. 2010) ku, Osaka Cereals, City 555- Functional 8502 Foods, & Snacks) Y 1259 onekyu C Okanomiya orporatio $1.55 4 n R Terabayashi, etail/HR Importers, 321 ¥136,334 N 055-922-5umazu 6 (Pork, I Direct B (Feb. 2010) City, eef, & P Shizuoka oultry) 410-8530 Morinaga & Co., Ltd. (Chocolate , Candy, 5-33-1 Shiba $1.53 4 Snacks, Retail/HR Importers, M 03-3456-0117 inato-ku, ¥134,493 ttp:// 7 Cookies, I Direct Tok hyo 108- (Mar. 2010) html Ice 8403 Cream, & Functional Foods) Fuji Oil 1 Sumiyoshi- $1.53 4 Co., Ltd. Retail/HR 072-463-1511 Importers, cho ¥134,411 8 (Oil, I Direct Izumisano C (Mar. 2010) hocolate, C l ity, Osaka Cooking 598-8540 Fats, Frozen Dough, Soy Protein, & Soy Milk) Dydo Drinco Inc. 2-2-7 (Canned $1.50 4 C R Nakanoshim etail/HR Importers, 06-6222-2611 offee, ¥131,845 9 Tea I D a, Kita-ku, irect r_eng/ , & (Jan. 2010) Os City Beverages 530-0005 ) 2-2-1 Kamakura Kawagishi $1.45 03-3257-2011 5 Retail/HR Impor Bldg, ters, ¥127,962 http://www.showa- 0 Showa I Direct Uchikanda, ( 2010) Industries Chiyoda-ku, Tokyo Source: The Beverage & Food Statistics Monthly, Nikkei Keizai Tsushinsha Food Manufactures Top 50 List, November 2010 Net sales: unconsolidated B. ENTRY STRATEGY Before You Start: 1. Before considering export, please consider the following factors: If your company has the production capacity to commit to the export market. If your company has the financial and non-financial (staff, time, etc.) resources to actively support your exported product(s). If your company has the ability to tailor your product’s packaging and ingredients to meet foreign import regulations, food safety standards, and cultural preferences. If your company has the necessary knowledge to ship overseas such as being able to identify and select international freight forwarders, temperature management, and other factors. If your company has the ability to navigate export payment mechanisms, such as developing and negotiating letters of credit. Product and Market: 1. Determine whether import of your product is allowed by Japanese food regulation. Because of strict Japanese regulations, there are many agricultural products that are prohibited for import from the U.S. to Japan. Contact an ATO Japan office for a list of prohibited items. For plant or animal health information, contact your local APHIS office at: If the product contains meat or meat products, please refer to the Food Safety Inspection Service Export Library: 1. Perform Some Basic Market Research: The Market Assessment Checklist is an effective tool to organize and evaluate your market and product: Determine whether there is demand for your product and what your target market will be. Determine whether your product is price competitive against Japanese and other producers, keeping in mind transportation costs as well as modification costs. Determine the comparative advantage of your products. Potential customers need to be convinced of the merit of using your products. Some examples are price savings, higher quality, higher value-added, or more convenient packaging. Agricultural Trade Office (ATO) Tokyo has services to assist you with market research and developing marketing strategies. You should also contact your regional trade group: a. Midwest: b. West: c. Northeast: d. South: Review Japanese food regulations to determine if your product(s) comply with or need to be altered to fit local laws regarding additives, residue levels, and processing procedures. Also understand regulations in terms of weight, size, and labeling. JETRO’s Handbook for Agricultural and Fishery Products Import Regulations is a helpful tool: Develop an Export Action Plan: 1. Once you have collected the general market, products, and regulatory information, begin the process of creating an export action plan. This plan will be instrumental in helping distributors and buyers see your vision. Keep in mind that many portions of this plan will change after personal interaction with the market or as more information is gathered. This action plan should include: Objective Goals and benchmarks, short-term and long-term Product Market Product packaging and handling Product modifications, if applicable Financial resources to be committed Non-financial resources to be committed Additional financing Potential importers and buyers Schedule Marketing plan Evaluation Get to Know the Market Personally: 1. Once you have determined that exportation is feasible and you have developed a basic strategy, either visit Japan to explore opportunities firsthand or find a representative to do so. When appointing agents, be sure your partner has a good reputation and track record in the market place. This face-to-face interaction is very important in business because Japan is unique in the respect that personal relationships are very important. Additionally, keep in mind that it takes time to form these relationships. 1. Understand how the Japanese distribution system works and begin the process of figuring out where you are to enter. Finding a Buyer: 1. Begin looking for potential buyers and distributors. To find trade leads, participate in trade shows, use the trade leads service, and contact the ATO Japan through its website: Foreign Buyers List: The Foreign Agricultural Service offers a foreign buyers list for many countries around the world. This list has information on prospective foreign buyers and these contacts can be acquired through the ATO Japan. Trade Leads service: The Trade Leads service is a way in which U.S. suppliers of food and agricultural products can receive targeted trade leads from foreign buyers seeking to import their products. In order to take advantage of these timely leads, a U.S. company must be registered on the U.S. Suppliers List (USL) database. The USL is managed through a cooperative agreement between the United States Department of Agriculture (USDA) Foreign Agricultural Service (FAS) and the National Association of State Departments of Agriculture (NASDA). Register at: Trade shows: There are a variety of trade shows, large and small, which act as great tools for market research as well as for finding potential distributors. A list of USDA endorsed trade shows can be found at: The three recommended trade shows in Japan for the food processing sector are: FOODEX JAPAN 2011: (March 1-4, 2011) International Food Ingredients and Additives Exhibition (IFIA) Japan 2011: (May 18-20, 2011) Health Ingredients Japan 2011: (October 5-7, 2011) 2. Meet with Japanese importers who distribute the types of agricultural products that you wish to export to learn more about the competitive environment. 1. Visit potential customers to determine if there is interest in your product and to determine how they normally source products. a. This is a good way to discover how products are normally reformulated and how packaging is tailored to the marketplace. Most packaging or labeling will have to be changed for the Japanese market, as American packaging is normally too large. Documentation and Shipping: 1. After revising your export action plan and finding a distributor, begin the process of setting up a payment structure and meeting import documentation requirements. Information on this area can be found at: 1. When ready to ship, begin the process of finding a freight forward that often will handle many of the logistics of shipping for a fee. Refer to the Agricultural Export Transportation Handbook for more information: Marketing: 1. When ready to market your product, use the ATO Tokyo or Osaka offices as resources for information on promotion and marketing. Additional Resources: 1. For any additional export information, refer to the USDA Foreign Agricultural Service’s export assistance website: and Helpful Tips: 1. Points to remember when doing business in Japan: Be clear with importers about the conditions under which price adjustments may occur. Be aware that Japan is a very service oriented culture and requires quick response to both product complaints and requests for information. Doing business for the first time in Japan requires patience. Orders normally start small to determine whether the product will meet market requirements. Arranging a credit check can be a good way to avoid issues in the future. There are a few Japanese companies that will conduct credit checks in English: Teikoku Databank America, Inc. 780 Third Avenue, 22nd Floor New York, NY 10017 Tel: 212-421-9805 | Fax: 212-421-9806 Email: The Dun and Bradstreet Corporation Tel: 1-800-234-3867 Website:
Posted: 12 January 2012

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