Cut flowers, foliage, and plants to Japan
(Last updated: 21 August 2013)
Trends and opportunities
The market
Japan’s 2011 retail flower market was valued at JPY1,032 billion (approximately A$10 billion). In 2012 it is estimated to shrink to around JPY 1,026 billion.
(Source: Yano Research Institute)
Despite having a reduced share of the market, Japan’s imports of flowers, foliage, and plants has increased or remains steady today. The key reasons behind these trend are:
- Imported flowers, especially varieties that are frequently traded are generally priced lower than domestic products.
- The quality of imported flowers is superior
- Domestic flower production has decreased – both the total value and proportion of Japan’s flower production against total output of agricultural produce has been declining since 2007
- The ageing population amongst growers also remains a challenge in this industry
- There are small groups of customers seeking and appreciating unique/high value flowers
- Potted plants and preserved flowers have increased in popularity
Flower production in Japan
| |
2007 |
2008 |
2009 |
2010 |
2011 |
| Total output of agricultural produce in Japan (Billion JPY) |
8,259 |
8,466 |
8,190 |
8,121 |
8,246 |
| Flower production in Japan (Billion JPY) |
405 |
366 |
351 |
351 |
338 |
| Flower production in Japan (per cent) |
4.9 |
4.3 |
4.3 |
4.3 |
4.1 |
(Source: Japan Ministry of Agriculture, Forestry, and Fisheries, ‘Statistics on agricultural production’)
The flower trade is greatly affected by climate and exchange rates. Therefore increases or decreases in imports per country do not accurately reflect market trends. The table below shows the key areas Australia has had a presence within the cut flower, foliage, and plants categories in Japan over the last five years (2008-2012).
| HS Code |
Product |
| 0602 |
Plants, live, NES (not elsewhere specified) including their roots, cuttings & slips; mushroom spawn |
| 0602.90.090 |
060290 Plants live, NES |
| 0603 |
Cut flowers and flower buds for bouquets, fresh or dried |
| 0603.11.000 |
Fresh Rose |
| 0603.12.000 |
Fresh Carnation |
| 0603.13.000 |
Fresh Orchid |
| 0603.14.000 |
Fresh Chrysanthemum |
| 0603.15.000 (*1) |
Fresh Lily |
| 0603.19.000 (*2) |
Fresh Other Variety |
| 0603.90.000 |
Dried flower |
| 0604 |
Foliage, Branches etc. |
| 0604.20.000 (*3) |
Fresh |
*1: 0603.19.010 until 2011, *2: 0603.19.090 until 2011, *3: 0604.91.000 until 2011
(Source: Japan Customs, ‘Japan's Tariff Schedule as of April 1 2013’)
Live Plants
Japan imported various live and rooted plants under HS code 0602.90.090 from 39 countries in 2012. The import value totaled A$85.33 million and the volume imported was 8,621MT; Australian exports made up 0.21 per cent of this (approximately A$180,000). Taiwan, China, and the Netherlands are the three main suppliers to Japan in this category.
While the import statistics do not specify the names of species, Austrade Japan has assisted companies in successfully exporting Jacaranda and Grass Trees in recent years. Several inquiries have also been received regarding the supply of unique plants such as carnivorous plants and succulents. Rooted cuttings/nursery stocks of the wildflower variety are being exported to Japan, to be maintained by Japanese growers and marketed as potted plants. Export licensing, tough quarantine requirements, and limited information on transplanting and caring methods are the major challenges for increasing exports of unique plants. Despite these challenges, Austrade Japan sees considerable market potential in this sector and is working on identifying and developing opportunities and qualified customers.
Cut Flowers
Japan’s imports of fresh and dried flowers under HS code 0603 have steadily increased over the last 5 years. The import value in 2012 from 38 countries totaled A$424.82 million, and the volume imported was 47,313MT. More than 90 per cent of these imports were the traditional or non-native varieties such as chrysanthemums, carnations, orchids, roses, and lilies.
The chrysanthemum is Japan’s national flower and forms the Imperial Crest. Large chrysanthemums are always used for Buddhist style funerals and are also used in offerings for the deceased. Carnations are the main gift for mother’s day and orchids (especially large sized orchids) and potted flowers are often used for special corporate gifts to celebrate the success or opening of a new office by partnering businesses. Roses are purchased for various occasions including celebrations and as romantic gifts. The market is very competitive and highly driven by price. Major suppliers of these flowers in 2012 by country were as follows:
- Chrysanthemums: Malaysia, China, Vietnam, Korea,
- Carnations: Colombia, China, Ecuador, Vietnam,
- Orchids: Thailand, Taiwan, Malaysia, New Zealand
- Roses: Korea, Kenya, India, Colombia,
- Lilies: Korea, Taiwan, China, Colombia, New Zealand, Israel
Australia’s strong presence within ‘Other Variety’ flowers
Australia occupies a key position within the ‘Other Variety’ category with its unique wildflower ranges. While Japan is Australia’s second largest trading partner, the share of Australian flowers in the entire cut flower market in Japan is considered to be around 1 per cent. This special niche product is mainly marketed through high-end florists and used at hotels, event venues and flower schools. Wildflowers do not directly compete with traditional or non-native variety flowers, as they tend not to be sold in bulk and do not form part of everyday sales from retail shops. Instead, wildflowers are sold to customers seeking a special and unique variety of flower.
In the wholesale market, Australia’s wildflowers posted the second highest total sales of niche, ‘non-traditional’ cut flowers in 2012 at the Ota Floriculture Auction, the largest flower auction house in Japan. South Africa remains Australia’s direct competitor in terms of wildflower varieties. South Africa sends more native varieties such as high quality protea, leucadendron, and banksia at low prices through competitive air freight rates and efficient production lines. To be competitive, Australian wildflower suppliers need to continue promoting their unique value based on the following key strengths:
- The ability to offer wider ranges of varieties with extended season throughout the regions
- uniform quality specification for frequently traded varieties
- advanced research skills with regards to production and marketing
Japan’s imports of the ‘other variety’ flowers have increased over the past five years. While Australia’s share of Japan’s imports shrunk recently due to natural disasters and a high Australian dollar, market potential continues to exist in this category due to the unique aspects of Australian products. Continuous follow-up is required to fully develop export opportunities for Australian suppliers.
Foliage
The value of Japan’s foliage imports in 2012 was A$75.55 million, and the volume was 16,296MT. Foliage is generally considered as ‘add on’ item to enhance the beauty of flowers. However, some specific varieties such as lemon leaves, dracaena, and branches of Sakaki trees are regularly used items in frequently sold mixed bunches and also for religious occasions. In 2012, Australia had a very small share in this sector, valued at A$263,000 (14.33MT).
Australia’s main export items in this sector are the unique native species (supplied by licensed exporters) such as steel grass foliage (the foliage part of grass trees), koala fern, umbrella fern, and the big leaves of gymea lily. These are well known by regular Japanese importers and wholesalers and marketed mainly among high-end florists who prepare special large arrangements for hotels, event venues and for special occasions. The volume currently used by Japanese customers is still very limited due to a lack of information on how and when to use Australian foliage. Also, budgets tend to be prioritised towards flowers rather than foliage, unless a special arrangement requires them. Foliage items remain a niche product in this market. Considering Japan’s general trend of seeking unique varieties, continuous promotion of foliage could further stimulate interest and demands by Japanese customers.
Tariffs, regulations and customs
Tariffs
Live and rooted plants under HS code 0602.90.090 and cut flowers under HS code 0603 are free from import duties.
For plant leaves and branches under HS code 0604, the general tariff rate is 5 per cent, and WTO tariff rate is 3 per cent.
In addition to import duties, Japanese importers are required to pay a 5 per cent consumption tax against the CIF or CFR value at the time of customs clearance.
Import procedures under the Plant Quarantine Law
Japanese Plant Quarantine Law prohibits the importation of the following items:
- Harmful animals and plants which the Japanese Ministry of Agriculture, Forestry and Fisheries (MAFF) defines as quarantine pests
- Soil and plants in soil
- Plants determined as illegal for picking, cultivating, or trading
- Containers and wrappings made from illegal items
Cut flowers, foliage, and plants exported to Japan must be free from pests, diseases and soil. All products must be fumigated or cleaned completely, pass inspection by AQIS and obtain a Phytosanitary Certificate prior to export shipment.
Japanese quarantine will conduct their own separate inspection at the port of entry into Japan. Here, they may still identify pests, disease, and soil on arrival. If identified, the importer will be required to choose one of the following options:
- Additional fumigation in Japan
- Abandon products at the port
- Send products back to Australia
All of the above options attract additional fees – a potential risk associated with Japanese quarantine procedures. Therefore, such risks need to be discussed in advance and agreement with new customers must be reached on how responsibility for risks will be shared.
Other regulations
Some items are registered under the Plant Variety Protection and Seed Law’s species registration system. Suppliers and importers must obtain permission for production and importation of these varieties from plant breeders or the species registration agents who may charge royalties depending upon the item.
Importing endangered species is prohibited by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES). However, if products are proven to be ‘commercially propagated items’ there may be exceptions granted.
Marketing your products and services
Market entry
The following points below should be considered when entering the cut flower, foliage, and plant market in Japan:
- A pre-entry study of market desirability
- Strategic selection of the export item and timing of export
- Efficient shipping arrangements that assure quality of products on delivery – export directly by yourself, through an experienced consolidator, or export agent
- Consider what types of customers you wish to do business with – Regular importers, wholesalers, large retail chains, etc. (See distribution channels below)
- Visit or participation in a major flower and plant tradeshow such as IFEX/GARDEX
Distribution Channels
The major wholesale distribution routes for cut flowers and foliage in Japan are:
Auction houses and large flower retailers sometimes directly buy or import from domestic and overseas suppliers but these routes do not make up the majority of purchases. Auction houses still play important roles within wholesale distribution, especially for small scale growers receiving payment right after their sales. In future, as more flowers and plants are traded outside of the central wholesale markets, a number of these markets will merge to improve efficiencies.
The auction system
While central/wholesale markets are increasing their proportion of fixed price sales based on negotiation prior to auction, around 30-40 per cent of cut flowers are still sold through the traditional auction system. Within this system, importers receive flowers, clear customs, and send flowers to auction houses on a consignment basis. Importers decide which markets to send flowers to, based on their own analysis and experience of which markets attract the highest prices. The final amount returning to the suppliers in Australia is fixed after the auction. The commission for Auction houses is usually around 10 per cent.
The auction system was developed due to difficulties in standardising quality of agricultural produce.
The downsides of the auction system are:
- Suppliers do not know the exact sales price until the auction is finished
- Market demand also influences price, so the delivery of high quality products does not always guarantee a good return to the supplier
- Buyers do not always receive the price they want
Only registered buyers can buy flowers directly through the auction system. Small retailers, flower designers, and other buyers tend to buy through ‘Intermediate Wholesalers’ who have stands/space within the auction houses.
Pre-ordering and pre-auction sales through auction houses
These systems are getting more popular in Japan today. Pre-ordering means that the importer takes orders from the auction house or their own customers before placing orders to the suppliers overseas. Pre-auction sales mean that the auction houses sell products to the buyers at fixed prices before auction runs (pre-auction). The prices for pre-ordering and pre-auction sales are usually higher than auction prices. This system gives an improved return, but suppliers have to make a commitment to satisfy the quality standards expected by the auction house and their customers, as they will buy before checking the actual quality. Failure to meet such expectations will reduce future sales and products will be re-directed to the general auction sale.
Direct sales to large retailers
Some large retail customers such as supermarkets buy flowers directly from suppliers or through importers. These sales do not go through auction houses and so auction house commissions are non applicable. However, opportunity for sales through this route is often limited to certain varieties that are reasonably priced and ideal for volume retailers.
Sales to importers and let them sell directly to their customers without going through wholesale market
Some importers have established a customer base and are selling directly to them. This includes home delivery sales and correspondence sales operated by the importer or their group companies. This way of distribution is still only small in today’s market compared to the traditional ways of distribution through central wholesale markets.
Links and industry contacts
Major Tradeshows
Reed Japan: International Flower Expo (IFEX) – www.ifex.jp/en/Home/
International Garden Expo (GARDEX) – www.gardex.jp/en/
Government, business and trade resources for Japan
Japan External Trade Organization (JETRO) – www.jetro.go.jp
JETRO: Guidebook for Export to Japan 2011: Cut Flowers – www.jetro.go.jp/en/reports/market/pdf/guidebook_cut_flowers.pdf
Ministry of Agriculture Forestry and Fishery Japan (MAFF) – www.maff.go.jp/e/index.html
MAFF: Plant Protection Station – www.pps.go.jp/english/index.html
Japan Customs: Trade Statistics – www.customs.go.jp/toukei/info/index_e.htm
Tokyo Metropolitan Central Wholesale Market – www.shijou.metro.tokyo.jp/english/index.html
Australian Resources
Biosecurity Australia: Export Process for the Plants and Plant Products – www.daff.gov.au/biosecurity/export/plants-plant-products
Contact details
The Australian Trade Commission – Austrade – is the Australian Government’s trade, investment and education promotion agency.
Through a global network of offices, Austrade assists Australian companies to grow their international business, attracts productive foreign direct investment into Australia and promotes Australia’s education sector internationally.
For more information on how Austrade can assist you, contact us on:
Australia ph: 13 28 78 | Email: info@austrade.gov.au
A list of Austrade offices (in alphabetical order of country) is also available.