Language selection

Search

Consumer profile – Japan

May 2020

Executive summary

Japan's real gross domestic product (GDP) is expected to grow from US$5.9 trillion in 2018 to US$6.3 trillion by 2022, making Japan the third largest economy in the world, behind the United States (U.S.) and China.

Japan's population is expected to shrink from 126.5 million in 2018 to 124.3 million by 2022, attributable to the country's low fertility rate and stringent immigration laws. The Japanese population is aging quickly–over the next four decades the share of the population aged 65 years and older expected to rise to almost four-in-ten persons.

In 2018, 52.3% of Japan's population was concentrated in 3 major metropolitan areas: Kanto (Tokyo - 37.4 million), Kansai (Osaka - 19.2 million), and Chubu (Nagoya - 2.3 million). The dependency ratio (over- 65 population as a share of the working-age (15 to 64 population) is one of the highest amongst the Organisation for Economic Co-operation and Development (OECD) nations.

Japan is the third-largest packaged food market in the world after the U.S. and China. However, this mature sector is seeing marginal growth, a trend that is expected to continue over the coming years.

In sales terms, the most important packaged food categories in Japan are chilled processed foods (led by chilled ready meals and chilled meats), dried processed foods (led by rice and instant noodles), and bakery products (led by bakery goods).

"Free from" and "functional and fortified" dairy and soy foods are expected to see the most significant sales growth over 2020-2023. Sales of attributed packaged food in Japan are expected to continue to grow, as consumers continue to seek out meal solutions amidst demographic and lifestyles changes.

Key demographic indicators

Japan's population is expected to shrink from 126.5 million in 2018 to 124.3 million by 2022. The contracting population is attributed to the country's low fertility rate and stringent immigration laws. Japan is one of the most densely populated countries with 91% of its population considered urban. In 2018, 52.3% of the total population was concentrated in the 3 major metropolitan areas: Kanto (Tokyo - 37.4 million), Kansai (Osaka - 19.2 million), and Chubu (Nagoya - 2.3 million). The Tokyo-Yokohama metropolitan area is the largest city in the world with 37.4 million people. Approximately one third of Japan's population reside in the Kanto region.

The Japanese population is the second-oldest in the world after Monaco, with a median age of 47.7 years. 22.5% of the population is under 24 years of age, 37.5% is between 25 and 54 years old and 40.0% is over 55 years old. The dependency ratio (over- 65 population as a share of the working-age (15 to 64 population) is one of the highest amongst the OECD nations.

The number of married people in Japan is approximately 62 million people, 50% of the population, whereas the number of 'single" people (unmarried, divorced, and widowed) reached approximately 44.2 million in 2018, representing a third of the population.

Japan's population 2018 (millions)
Category 2018
Urban population 115.6
Urban population as % of total 91.7%
Rural population 10.6
Rural population as % of total 8.3%
Total population 126.2
Source: GlobalData Intelligence, 2019
Japan's gender, marital status distribution 2018 (millions)
Category 2018
Male/female 61.3/64.8
Married 61.9
Divorced 5.7
Widowed 9.6
Unmarried 28.9
Source: GlobalData Intelligence, 2019

Economic indicators

Japan's real GDP is expected to grow from US$5.9 trillion in 2018 to US$6.3 trillion by 2022, making Japan the third largest economy in the world, behind the U.S. and China. Growth is expected to be driven by rising domestic consumption, stronger private capital expenditure, particularly in the financial and services sectors, an increase in private inventory investment in raw materials such as oil and recovery of exports. Household consumption is expected to grow over the next 5 years with expected rise in wages. Consumer price inflation is expected to grow from 1.0% in 2018 to 1.6% by 2022 driven by the Bank of Japan's decision to keep interest rates at −0.1%.

Japan's unemployment rate fell from 3.3% in 2015 to 2.2% in 2018 and is expected to hover around 2.7% during the 2018-2022 period. The Japanese government's efforts to boost the economy by increasing money supply, spending more on infrastructure and renewable energy projects and undertaking structural reforms to make the Japanese workforce more competitive and productive have contributed to growth in employment levels in the country. Moreover, increased global demand for Japanese goods is spurring manufacturing activities, thereby boosting employment in the country.

The Japanese population is aging quickly–over the next four decades the share of the population aged 65 years and older expected to rise from its current three-in-ten persons to almost four-in-ten persons. This will depress growth and productivity due to a shrinking and aging labor force and a shift toward consumption, while fiscal challenges will magnify with rising age-related government spending and a shrinking tax base.

According to the Statistics Bureau of Japan, the average monthly consumption of one-person households in 2018 was ¥162,833 (US$ 1,483.03). By age group, the average monthly spending on food was ¥41,358 (US$ 376.67) for those under 34 years old, ¥45,378 (US$ 413.29) for those 35-59, and ¥36,986 (US$ 336.86) for those 60 and over. Spending on food was highest for those aged 35-54 and lowest for those 60 and older. The average monthly spending on food was ¥40,046 (US$ 364.73).

Monthly disbursements per household by age group (one-person households) 2018
Item Monthly total (¥)
Average 34 and under 35-59 60 and over
Total monthly spending 162,833 164,807 182,207 152,792
Food (total) 40,026 41,358 45,378 36,986
Food (male) 45,693 47,068 51,863 39,440
Food (female) 35,021 32,683 34,332 35,681
Source: Japan Statistical Yearbook 2020

Food and beverage retail sales

Japan is the third-largest packaged food market in the world after the U.S. and China. However, this mature sector is seeing marginal growth, a trend that is expected to continue over the coming years. Retail sales were valued at US$207.4 billion in 2019, with a CAGR of 2.3% from 2016 to 2019. By the year 2023, retail sales are expected to reach US$236.7 billion, growing by 2.1%. In sales terms, the most important packaged food categories in Japan are chilled processed foods (led by chilled ready meals and chilled meats), dried processed foods (led by rice and instant noodles), and bakery products (led by bakery goods).

Yogurt, cheese, and ready meals are expected to see the most significant sales growth over the 2020-2023 forecast period. Examples of ready meals are prepared foods sold at supermarkets, takeout meals sold at specialty store chain operators, and various ready-made foods sold at convenience and department stores. Growth in this category is closely linked to the rising number of women working outside of the home, the increasing frequency of single-person households and the fast-growing elderly demographic.

Retail sales of alcoholic and non-alcoholic beverages have remained steady. Consumers in Japan are increasingly choosing craft beers with more variety and flavors and seeking innovation rather than sticking to one brand. Alcohol-free beer is growing in demand and is popular with younger consumers because of its health benefits.

Retail sales food and beverages in Japan, historic/forecast by category, using fixed rates in US$ million, 2016-2023
Category 2016 2019 CAGR* (%) 2016-2019 2020 2023 CAGR* (%) 2020-2023
Packaged food 202,749.0 207,388.3 2.3 222,220.6 236,721.4 2.1
Ready meals 17,426.3 19,427.4 3.7 20,102.9 22,141.4 3.3
Fresh meat 16,315.2 16,804.4 1.0 17,017.8 17,493.1 0.9
Rice 18,305.9 17,711.2 −1.1 17,609.1 17,230.5 −0.7
Cakes/pastries/sweet pies 12,627.9 13,288.8 1.7 13,552.4 14,141.7 1.4
Condiment sauces 6,973.5 7,570.9 2.8 7,813.9 8,446.4 2.6
Milk 7,859.1 8,044.6 0.8 8,132.4 8,338.5 0.8
Yogurt 4,216.6 5,847.9 11.5 6,374.9 8,233.8 8.9
Ethnic/traditional snacks 5,507.7 6,076.4 3.3 6,298.7 6,773.7 2.5
Cheese 3,849.5 4,474.2 5.1 4,708.5 5,326.1 4.2
Cookies (sweet biscuits) 4,799.5 5,001.9 1.4 5,083.2 5,297.7 1.4
Dried and instant noodles 4,322.7 4,711.4 2.9 4,842.8 5,121.7 1.9
Chocolate 4,389.8 4,668.1 2.1 4,780.6 5,061.2 1.9
Chilled raw meat - whole 4,358.0 4,665.5 2.3 4,759.3 4,939.8 1.2
Oils 3,896.0 4,160.2 2.2 4,270.0 4,554.0 2.2
Pizza 3,832.2 4,105.5 2.3 4,213.6 4,531.7 2.5
Ice cream - single serve 3,812.1 4,070.3 2.2 4,172.0 4,455.5 2.2
Chilled processed meat 3,806.9 4,122.8 2.7 4,210.6 4,385.1 1.4
Sugar confectionery 3,876.9 4,086.0 1.8 4,172.4 4,377.5 1.6
Non-alcoholic beverages 102,544.7 107,180.6 1.5 109,287.2 114,861.3 1.3
Soft drinks 80,880.6 82,983.0 0.9 84,114.1 86,844.4 0.8
Hot drinks 21,664.1 24,197.6 3.8 25,173.1 28,016.9 2.7
Alcoholic beverages 109,026.4 118,248.9 2.7 121,813.1 130,885.4 1.8
Spirits 59,062.9 65,458.3 3.5 67,661.0 73,557.4 2.1
Beer and cider 40,498.8 41,913.1 1.2 42,763.7 44,522.1 1.0
Wine 9,464.7 10,877.5 4.7 11,388.4 12,806.0 3.0

Source: GlobalData Intelligence, 2019

*CAGR: Compound Annual Growth Rate

Health and wellness

"Free from" and "functional and fortified" dairy and soy foods are expected to see the most significant sales growth over 2020-2023. "Free from" denotes food products that do not contain ingredients known to cause a reaction in people with food allergies or intolerances, such as lactose and gluten. In sales terms, the largest attributed packaged food categories in Japan are dairy and soy food, prepared meals, and bakery and cereals. Sales of attributed packaged food in Japan are expected to continue to grow, as consumers continue to seek out meal solutions amidst demographic and lifestyles changes.

Japan health and wellness market - historical/forecasted retail value - Can$ million
Categories 2015 2019 CAGR* % 2014-2018 2020 2023 CAGR* % 2019-2022
Total health and wellness 19129.0 21879.5 3.4 22,720.0 25,338.5 2.8
Naturally healthy 10955.9 11742.1 1.7 11,971.4 12,627.6 1.3
Functional and fortified 2677.7 3770.1 8.9 4,159.8 5,410.2 6.8
Free from 3465.8 4055.1 4.0 4,226.1 4,798.4 3.2
Food minus 1039.2 1223.2 4.2 1,246.0 1,319.5 1.4
Food intolerance 990.4 1089.0 2.4 1,116.7 1,182.8 1.4

Source: GlobaData, 2020

*CAGR: Compound Annual Growth Rate

Naturally healthy

Attributes such as 'naturally healthy' and 'free from' are expected to drive growth in the Japanese dairy and soy industry to 2022, driven by an increasing affinity among Japanese consumers to dairy-rich western diets.

While dairy has existed in Japan for decades, dairy-based diets only recently became ubiquitous among Japanese consumers, especially for yogurts and drinkable yogurts, which have become a consumer-wide trend for its supposed health-benefits.

Attributes such as 'naturally healthy' are expected to contribute the most towards the growth of the health and wellness market in the Japanese prepared meals sector during 2020-2022, with sales forecast to grow by a CAGR of 2.4% during 2020-2022. Consumption of prepared meals is higher among males than females, with older consumers (55+ years) accounting for the highest consumption of prepared meals with 30.9% volume share in 2018. In addition, Japan's large aging population is highly health conscious and willing to spend more on dairy and soy products labeled with health and wellness benefits.

Functional and fortified

'Functional and fortified' is the fastest growing attributable category and is expected to contribute the most to the growth of the health and wellness market in the Japanese bakery and cereals sector during 2017-2022. Consumption of bakery and cereals is higher among males than females, with older consumers (55+ years) accounting for the highest consumption of bakery and cereals with 33% volume share in 2018.

Retail sales food in Japan by category and attribute, historic/forecast using fixed rates in US$ million, 2017-2022
Category Attribute 2017 2019 CAGR* (%) 2017-2019 2020 2022 CAGR* (%) 2020-2022
Packaged food 143,397.0 156,217.1 2.9 160,657.7 169,915.0 1.9
Dairy and soy food Naturally healthy 5,001.3 5,185.0 1.2 5,235.0 5,361.3 0.8
Prepared meals Naturally healthy 3,178.3 3,472.7 3.0 3,587.6 3,848.5 2.4
Bakery and cereals Functional and fortified 1,435.0 1,808.2 8.0 2,039.3 2,501.8 7.1
Dairy and soy food Free from 870.2 1,091.9 7.9 1,183.8 1,408.3 6.0
Confectionery Free from 1,205.4 1,247.0 1.1 1,248.0 1,248.0 0.0
Oils and fats Free from 740.3 842.6 4.4 881.7 964.8 3.0
Dairy and soy food Food minus 709.4 772.2 2.9 791.9 837.6 1.9
Dairy and soy food Functional and fortified 502.7 596.5 5.9 638.7 748.6 5.4
Confectionery Functional and fortified 477.6 609.5 8.5 645.4 718.9 3.7
Dairy and soy food Food intolerance 402.3 441.6 3.2 453.7 477.3 1.7
Bakery and cereals Naturally healthy 403.2 431.1 2.3 438.6 453.7 1.1
Savory and deli foods Food intolerance 339.4 363.0 2.3 369.7 382.9 1.2
Ice cream Food minus 113.7 177.9 16.1 174.2 166.3 −1.5
Ice cream Naturally healthy 41.6 99.6 33.8 93.3 79.8 −5.1
Bakery and cereals Free from 59.9 63.3 1.8 64.0 65.5 0.8

Source: GlobalData Intelligence, 2019

*CAGR: Compound Annual Growth Rate

Opportunities

On March 8, 2018, Canada signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) with 10 countries: Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. CPTPP represents a significant step toward closer trade and investment between Canada and Japan. Significant gains are possible for Canadian producers, who could gain market share in economies such as Japan. The CPTPP provides Canada with greater market access to CPTPP countries with the same level of tariff as major regional competitors like Australia and New Zealand for key sectors, including beef, pork, seafood, cereal and many others. Access Japanese tariff reductions (PDF) to obtain more information on specific Japanese tariff reductions under this agreement.

The CPTPP Agreement, along with NAFTA and free trade agreements with the European Union (CETA) and South Korea (CKFTA), will make Canada the only G7 nation with free trade access to the Americas, Europe and the Asia-Pacific region. All Canadian provinces and territories are expected to benefit from the CPTPP.

FOODEX Japan is the largest food and beverage show in Asia, and is an important annual event for Canadian exporters as it brings in key buyers from Japan and Asia. The 2019 show attracted 3,250 exhibitors from 78 countries and regions and 77,000 professional visitors.

FOODEX is a flag-ship trade show, which means there will be a Canadian pavilion and potential financial booth-space support available for eligible Canadian companies. Please visit the Canada Pavilion Program for more details and for contact details at Agriculture and Agri-Food Canada to register and obtain additional information on the Canadian government's role.

For more information

International Trade Commissioners can provide Canadian industry with on-the-ground expertise regarding market potential, current conditions and local business contacts, and are an excellent point of contact for export advice.

For additional intelligence on this and other markets, the complete library of Global Analysis reports can be accessed through the International agri-food market intelligence page.

For additional information on Foodex 2020 , please contact:

Ben Berry, Deputy Director
Trade Show Strategy and Delivery
Agriculture and agri-food Canada
ben.berry@canada.ca

Resources

Consumer profile – Japan
Global Analysis Report

Prepared by: Kris Clipsham, Market Analyst

© Her Majesty the Queen in Right of Canada, represented by the Minister of Agriculture and Agri-Food (2020).

Photo credits
All photographs reproduced in this publication are used by permission of the rights holders.
All images, unless otherwise noted, are copyright Her Majesty the Queen in Right of Canada.

To join our distribution list or to suggest additional report topics or markets, please contact:

Agriculture and Agri-Food Canada, Global Analysis
1341 Baseline Rd, Tower 5, 3rd floor
Ottawa ON  K1A 0C5
Canada
Email: aafc.mas-sam.aac@canada.ca

The Government of Canada has prepared this report based on primary and secondary sources of information. Although every effort has been made to ensure that the information is accurate, Agriculture and Agri-Food Canada (AAFC) assumes no liability for any actions taken based on the information contained herein.

Reproduction or redistribution of this document, in whole or in part, must include acknowledgement of agriculture and agri-food Canada as the owner of the copyright in the document, through a reference citing AAFC, the title of the document and the year. Where the reproduction or redistribution includes data from this document, it must also include an acknowledgement of the specific data source(s), as noted in this document.

Agriculture and Agri-Food Canada provides this document and other report services to agriculture and food industry clients free of charge.

Report a problem on this page
Please select all that apply:
Date modified: