Fruit and vegetables to Japan
Trends and opportunities
The Japanese market for fresh fruit and vegetables has traditionally been dominated by domestic suppliers, with imports limited to a narrow range of products. Due to decreasing competitiveness in the domestic farm sector, global climate change, natural disasters and the opening up of the import market, Japan has steadily increased import volumes in order to secure sufficient supply to meet the country’s demand.
Self-sufficiency of food production in Japan remains relatively low - the rate on a calorific basis in 2013 was 39 per cent, the same percentage rate as in 2012 (Source: Ministry of Agriculture, Forestry and Fisheries, FY2013 Annual Report on Food, Agriculture and Rural Areasin Japan, 2014). Both size of the planted area and production volume of vegetables significantly declined by over 25 per cent in 2013 compared to the previous year, which has resulted in the lower self-sufficiency rate. (Source: Ministry of Agriculture, Forestry and Fisheries, Self-sufficiency 2013, P2, 2013)
The value of the cut vegetable market is estimated to be around JPY180 billion and has grown over the past few years, by approximately 30 per cent per year. (Source: Agriculture & Livestock Industries Corporation, Cut vegetable demand structure fact-finding investigation, P28, 2014).
With the increase of single households and a high demand for convenience, a large number of packed cut vegetables and fruit are appearing in retail stores and fruit is being sold in some vending machines.
The Great East Japan Earthquake and subsequent tsunami in March 2011 caused production and supply shortages of fresh vegetables in the Tohoku area. Due to rising food safety and security concerns over possible longer term radiation threats to food production, the need for imports has increased. Although production capacity in the Tohoku area has recently improved through reconstruction efforts, consumers’ negative perceptions and misinformation about food production remains.
The price remains higher for domestic fresh produce rather than imported, as Japanese farming efficiencies are lower than other countries, due to small production yields and high labour costs. Japanese demand for imported produce remains high, although there is still a niche market where consumers are willing to pay a higher price to support the domestic industry. Quality produce that is fresh and safe is absolutely essential to consumers and some consider domestic produce to fill this criteria.
Japanese growers have spent considerable time and energy in improving their products based on taste, appearance and development of production know-how to supply out of season produce.
Each growing region has their own brand of fresh vegetables, which adds value to sales and creates competition. In contrast, when selling vegetables for processing and food service, the price and consistency of large volumes of supply become more important than promoting brand names. Imported vegetables which are more price competitive, tend to satisfy this demand.
The total value of vegetables (HS code 07) imported in 2013 was JPY244.7 billion, an increase of 11.4 per cent compared to the previous year. In terms of value, China followed by the US, accounted for about 69 per cent of Japan’s total vegetable imports in 2013. In the same year, Australia ranked 12th for importing vegetables, with a value of JPY2.18 billion. The main imported vegetables were frozen vegetables and fresh vegetables, which are also grown in Japan where onions, carrots, cabbage and tomatoes. (Source: Ministry of Finance, Japanese Customs, Trade statistics for Japan, Sept 2014)
The total value of fruit and nuts (HS code 08) imported in 2013 was JPY289.6 billion, an increase of 14 per cent compared to the previous year. In terms of value, the US followed by the Philippines accounted for about 62 per cent of Japan’s total fruit imports in 2013. In the same year, Australia ranked sixth for importing fruit, with a value of JPY6.7 billion. The main fresh fruit imports were bananas, nuts, citrus, grapefruit, grapes, pineapples, kiwifruit and stone fruit.
Fresh fruit imports are predominantly supplied by only a few countries:
- over 96 per cent of grapefruit from the USA and South Africa
- 95 per cent of kiwifruit from New Zealand
- 90 per cent of oranges from the USA and Australia
- 90 per cent of pineapples and bananas were from the Philippines.
(Source: Ministry of Finance, Japanese Customs, Trade statistics for Japan, Sept 2014).
Japanese consumers are interested in high quality, fresh, clean, safe and value-for-money produce from overseas. Read this flyer (PDF, 781KB) on export opportunities and using JAEPA to export your fruit and vegetable products to Japan.
Potential opportunities for Australian fresh fruit and vegetables are:
- pumpkin (from Tasmania only)
- lettuce, cabbage and cauliflower
- sweet corn
- navel and valencia oranges
- table grape
- cherries and apples (from Tasmania only)
- varieties of nuts
Australia has a number of competitive advantages when exporting fresh fruit and vegetables:
- Supply of counter seasonal produce
- Several Japanese varieties are grown in Tasmania and exported to Japan
- Australia’s diverse climate and soil varieties, enable the harvesting of a wide variety of produce and production with low levels of chemical fertilisers
- Consumer awareness of Australia’s clean, green environment and low chemical usage which adds to Australia’s appeal as a supplier of safe foods
- Less shipping time compared to other countries in the southern hemisphere which leads to the supply of fresh produce with superior quality
- Improved domestic infrastructure for delivery of imported products into Japan
- The deregulation of Japanese plant quarantine laws which is easing restrictions and opening up markets for new products.
The US remains the top exporter to Japan for some products in the fresh vegetable and fruit sectors. However, China and other Asian and southern hemisphere countries have become major suppliers, increasing both the range and volume of fresh fruit and vegetables imported into Japan.
China is recognised as one of the lowest-cost suppliers of vegetables, with other overseas producers unable to compete on price. However, there have been cases of Chinese produce being restricted or banned, due to levels of chemical residue and several food safety issues.
Australia is also facing stronger competition from Chilean and South African producers due to their location in the southern hemisphere. They are taking advantage of counter seasonality by supplying similar types of products at more competitive prices.
Tariffs, regulations and customs
When the Japan Australia Economic Partnership Agreement (JAEPA) enters into force, there will be immediate tariff elimination on the vast majority of Australia’s vegetables, fruit and nuts. For example, tariffs on macadamia nuts and asparagus, worth $16.2 million and $13.5 million in 2013 respectively, will be eliminated. (Source: Department of Foreign Affairs and Trade, Japan-Australia Economic Partnership Agreement)
Exporters are advised to look closely at tariff rates before exporting to Japan. Some fresh fruit and vegetables will attract a seasonal tariff, depending on the time at which they are imported.
The Japanese Government prohibits importers of fresh fruit and vegetables where soil is evident and plants have soil attached or produce contains evidence of pests and pathogens.
Under the Plant Protection Act’s designated quarantine procedures, fresh vegetables and fruit are checked by the Ministry of Agriculture, Forestry and Fisheries’ (MAFF) Plant Protection Station. This includes a phytosanitary inspection which screens for contamination by any pests or harmful plants. For details of the quarantine procedures, visit the Plant Protection Station.
The Ministry of Health, Labour and Welfare (MHLW) introduced a list system, prohibiting the distribution of food containing agricultural chemicals (pesticides, feed additives and veterinary drugs) above a certain level of Maximum Residue Limits (MRLs).
More information about the list system is available on the Ministry of Health, Labour and Welfare website:
Marketing your products and services
Market entry strategies will vary according to products and segments and exporters should consider the following points:
- Promote Australia’s competitive advantages in counter seasonal, climate, soil variation and ‘clean, green and safe’ image
- Secure local representation where possible
- Emphasise shared time zones, which allow for rapid business communications
- Offer various options for shipment routes – direct or trans-shipment
- Provide regular information about climate, growing and harvest conditions and traceability including use of chemicals
- Provide details of produce conditions before shipment and obtain feedback from importers after landing
- Obtain agreement for supply contracts throughout the growing season
- Offer produce grown in different locations to maintain consistency of supply
- Agree to a trial shipment - a step towards securing long term supply contracts
- Frequent visits to the market and follow-up with customers regularly
- Awareness of customer preferences and needs through research and communication
The use of technology to support operations in importing is increasing, although direct online trading is not yet an option. Many importers use email and the internet to check produce quality by digital photo before shipping and on arrival. Face-to-face contact and the building of personal relationships still heavily influence buying decisions.
Distribution channels and importers vary according to the nature of the product and end user. Typical distribution channels begin with the growers, then the packers and/or exporters, fruit and vegetable importers and finally, the Japanese trading companies. From that point onwards, produce will go to either wholesale market operators, food processing companies, retailers and/or restaurants.
Other distribution options can bypass wholesalers and go directly to retailers, particularly large supermarket chain stores, food processing companies or restaurant chain outlets.
An increasing trend is for grouped supermarkets with a large number of stores that have considerable buying power to import directly from growers and packers. However, this channel is only suitable for produce that can be imported directly, with minimal handling and storage requirements.
Links and industry contacts
Government, business and trade resources
Ministry of Agriculture, Forestry and Fishery
Ministry of Health, Labour and Welfare
Ministry of Finance
Japan External Trade Organization
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