Market Overview – Japan

Production

Rice is by far the most important crop in Japan, but production declined in both 2015 and 2016.

Among the top 10 production crops, sugar cane saw the most significant increase in 2016, growing by 24.9% over the volume recorded in 2015. Sugar cane was also the fastest-growing production crop across the whole 2012–2016 period, with a compound annual growth rate (CAGR) of 9.2%.

Trade

Japan is a net importer of agri-food and seafood products. In 2017, Japan's agri-food and seafood trade deficit was Can$84.1 billion with imports valued at Can$92.3 billion, and exports of Can$8.2 billion. Japan's agri-food and seafood imports grew at a CAGR of 4.1% between 2013 and 2017.

Japan's top agri-food and seafood imports in 2017 were corn, cigarettes, frozen pork, prepared chicken meat and fresh boneless beef. Key supplying countries were the United States, China, Thailand, Australia and Canada. Canada was Japan's fifth-largest supplier of total agri-food and seafood products in 2017, with a 5.6% share.

Japan's processed food and beverage imports were valued at Can$47.5 billion in 2017, with Canada accounting for 4.7% of that total. The United States, China, Thailand, Australia and Canada were the largest suppliers of processed food to Japan in 2017, accounting for 55.2% of the market. Japan's processed food imports increased by a CAGR of 4.8% between 2013 and 2017.

Canada's agri-food and seafood exports to Japan were valued at Can$4.6 billion in 2017. Top exports were canola, pork, non-durum wheat and soybeans. In 2017, Canada registered an agri-food and seafood trade surplus of Can$4.4 billion with Japan (Canada imported Can$143.1 million worth of agri-food and seafood from Japan in 2017).

Retail sales

Japan is the third-largest packaged food market in the world after the United States 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$174.4 billion in 2017, with a CAGR of 1.3% from 2013 to 2017. By the year 2022, retail sales are expected to reach US$192.8 billion, registering a stronger growth rate of 2.1%.

Spreads and breakfast cereals are expected to see the most significant sales growth in the packaged food sector over the 2018–2022 forecast period. The ready meals category is also expected to be among the better performers over the forecast period in terms of sales growth. Examples of popular products in this subsector 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.

Packaged health and wellness food products

The health and wellness sector grew by a CAGR of 1.8% from 2013 to 2017 and is expected to grow by a CAGR of 3.2% over the 2018–2022 period. The large aging senior demographic will have a positive effect on this sector as well as the overall health consciousness of the average Japanese consumer.

Free-from products and fortified/functional foods showed the largest growth in the 2013–2017 period. Free-from and naturally healthy products will lead the way over the next five years.

Opportunities for Canada

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 Tariff schedule of Japan (HS2012) (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 2017 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 page 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.

• Overview of Trade Commissioner Services in Japan
• Find a Trade Commissioner

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

For additional information on FOODEX Japan 2019, please contact:

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

Market Overview – Japan
Global Analysis Report

Prepared by: Karen Guilbault, Data Analyst
Hongli Wang, Market Analyst

© Her Majesty the Queen in Right of Canada, represented by the Minister of Agriculture and Agri-Food (2018).

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