Japan Studies

Back to Contents of Issue: March 2001

Agricultural Self-Sufficiency: A revealing look at Japanese attitudes toward domestic and foreign food.

by William Hall

JAPAN'S STUNNINGLY HIGH RETAIL prices for agricultural products in top quality supermarkets -- ¥10,000 for a musk melon, ¥300 for one strawberry, and ¥40,000 per kilo for top Kobe beef -- make good conversation pieces for travelers returning from Japan. While only a small percentage of Japanese actually shop in these upscale locations and pay such sums, the fact remains that prices for agricultural products in Japan are significantly higher than in other major industrialized nations.

Japan is a nation of some 125 million people with few natural resources crowded into an area approximately the size of California, of which only some 13 percent is usable for dwellings, industry, and agriculture combined. Not surprisingly in this situation, stability of food supply has been a matter of continuing concern for government planners and the general population alike. Memories of food shortages during and immediately after World War II remain vivid among the older generation, and the curtailment of soybean exports to Japan by the US in the early 70's has still not been forgotten by bureaucratic planners.

In 2001, World Trade Organization (WTO) negotiations on agricultural products are due to begin in earnest. A successful conclusion to these negotiations would lead to increased imports of agricultural products which in turn offer the promise of significantly lower prices for agricultural products to Japan's long suffering consumers. But low-priced imports are also likely to radically undermine the hopelessly inefficient agricultural sector, raising the specter of the country's food supply becoming increasingly dependent upon imported products.

The twenty-something Netpreneur may ask, "What relevance does agricultural policy have for me?" The answer is that it could be quite significant. Both entrepreneurs and their customers have to eat, and any reduction in the Engel's coefficient for expenditure on food means more money available for spending on other items. As we have seen over the past few years, a key drag on the Japanese economy has been the absence of recovery in consumer demand, which makes up more than 60 percent of GDP. Any activity that may help in this arena is to be welcomed.

Importantly also, given the current and projected budget deficit, any increase in expenditures in agriculture will shrink the amount of government money available for development in the New Economy.

So what does the average Japanese think about agricultural imports, the need for self-sufficiency in agriculture, and related topics? In October 2000, the Public Opinion Research Section within the Prime Minister's Office released the results of a study entitled "Public Opinion Survey in Regard to Trade in Agricultural Products" (Nosanbutsu Boeki ni Kansuru Yoron Chosa).

Fieldwork for the study was conducted in July 2000 and involved personal interviews with an attack sample of 5,000 randomly selected Japanese nationals aged 20 years and above. A 71 percent completion rate was achieved, yielding 3,570 completed interviews (1,644 males and 1,926 females).

Respondents were asked what product they would choose in the case that domestic products and imported products were lined up together when they were buying foodstuffs. A high 65 percent responded outright that they would choose domestic products, with a further 17 percent stating that they would lean toward domestic products. Thus, 82 percent of the total population can be considered as expressing a preference for domestic products. Another 17 percent said they didn't care whether it was foreign or Japanese, while only 0.4 percent stated that that they would choose or lean towards imported foodstuffs.

Females were more strongly inclined to choose Japanese products than males, while respondents in their 20's gave significantly higher scores for not caring whether the product was domestic or foreign. There was also a weaker inclination to choose domestic products among respondents in major urban areas.

When asked the reason for their preference for Japanese products, 82 percent gave Safety, followed by Freshness (57%), Quality (42%), and Deliciousness (28%). Price received a mere 11 percent mention.

Respondents were then asked what they thought about importing foodstuffs from foreign countries. When giving their response, respondents were asked to choose only one answer from among four answers shown on a card. The largest response was 47 percent for Unease About Safety, followed by Expansion In Freedom of Choice (21%), Prices Will Become Cheaper as a Result of Competition from Foreign Products (17%), and Domestic Production Will Decline (11%).

There are significant differences in response by both age and gender. Older respondents were more concerned about Safety and the Decline of Domestic Products, while younger respondents were more interested in Freedom of Choice and Lower Prices. Women tended to have a higher concern for Safety than men (see Table 1).

No.1 = Uneasy About Safety
No.2 = Freedom of Choice Will Expand
No.3 = Prices Will Become Cheaper as a Result of Competition from Foreign Products
No.4 = Domestic Production Will Decline
  No.1 No.2 No.3 No.4
Total 47% 21% 17% 11%
  Male Female Male Female Male Female Male Female
% % % % % % % % %
20-29 28 41 32 29 25 16 8 9
30-39 32 48 29 24 27 19 9 7
40-49 38 53 28 23 22 13 9 10
50-59 40 61 24 17 23 11 11 9
60-69 43 55 19 14 21 13 12 13
70+ 44 53 15 9 14 8 16 13

Throughout the survey, Japanese respondents showed a strong preference for domestic products because they are perceived to be safer. This concern with the safety of foreign products predates the recent problems with Mad Cow disease and StarLink genetically modified corn. For many years the Japanese media has continued to run negative stories about excessive pesticide use in foreign agricultural products. Yet there was virtually no mention in the media that less than one percent of domestic products qualified as being free of chemicals when stricter labeling laws regarding the definition of "organic" were introduced in June 2000; nor that Japan is one of the largest pesticide markets in the world, despite the relatively small size of its agricultural sector.

Respondents were informed that, on a calorie basis, Japan's current self-sufficiency ratio in foodstuffs was around 40 percent, and they were asked their opinion about this level. Fifty-three percent thought the level was Low/On the Low Side, 20 percent thought the level was About Right, 11 percent thought the level was High/On the High Side, and 17 percent gave Don't Know as an answer.

Respondents were then asked what approach, from among three choices, they thought Japan should adopt in regard to production and supply of foodstuffs. A similar question was asked in an earlier survey in 1996, and the results are similar for both years.

  • Even if they are more expensive than foreign products, it is better to produce foodstuffs in Japan as much as possible while lowering domestic production costs (44% in 2000, 46% in 1996).
  • Even if they are more expensive than foreign products, at least for main staples such as rice it is better to produce as much as possible in Japan while lowering domestic production costs (41% in 2000, 38% in 1996).
  • It is better to import those foodstuffs where the foreign product is cheaper (11% in both 2000 and 1996).

The responses to the above question will likely be taken by the Ministry of Agriculture, Forestry, and Fisheries (MAFF) as public acceptance of higher agricultural product prices to protect domestic production and stability of supply. However, there was the caveat in the question, to wit, "while lowering production costs." As in other sectors of the economy, the Japanese consumer is looking for productivity improvements and structural reform.

Unfortunately, however, when questions such as the above are posed by MAFF, information necessary for an informed choice by the respondent is not always provided. There is no mention, for example, that the price of rice in Japan is many times the price of similar quality Japonica rice available in low cost production countries such as the US or Australia. Nor that rice consumption is declining in Japan and that the Japanese government already has huge (and expensive) stockpiles of rice that it is unable to get rid of. These factors, combined with tiny farm sizes and an aged farming population, make it virtually impossible for Japan to reduce production costs by anywhere near the amount required to make Japanese rice competitive. Would the response to the question have been different if these facts had also been included? It would certainly be interesting to find out.

Respondents were asked whether they thought agriculture fulfilled various roles besides the production and supply of foodstuffs, for example, protection of the environment and land. About one in three respondents (32%) felt that agriculture does play such a role. A further 33 percent stated that If Forced to Choose, Think Agriculture Does Play Such a Role, while 25 percent thought that it Did Not Play Such a Role Very Much/At All, and 10 percent gave Don't Know.

Those who responded in the affirmative that agriculture had a role besides production and supply of foodstuffs were asked what role that might be. To assist respondents, a series of answers were provided on a card, and they were asked to choose from among these. As can be seen in Table 2, some of the choices provided could best be described, charitably, as stretching it -- agriculture helps to provide an environment for fireflies, provides beautiful pastoral scenery, transmits traditional culture, cultivates sentiments about the preciousness of life, and so on.

Protection of the Natural Environment (providing protection of the environment where waterfowl, fireflies, dragonflies, small fish, etc., live) 65
Protection of the Land (by storing rainwater, which helps prevent floods, landslides, et cetera) 56
Buildup of Water Resources (water from fields and rice paddies permeates the earth, helping to enhance subterranean water supplies) 45
Foodstuff Security (eliminates people's anxieties about having sufficient food supplies, both now and in the future) 40
Creates Excellent Scenery (offers beautiful pastoral scenes, etc.) 38
Sentiment Cultivation (the experience of nature, farm life, etc., helps to cultivate sentiments such as an understanding of the preciousness of life) 34
Moderation of Weather Conditions (presence of rice paddies moderates the weather in surrounding areas, especially in summer) 32
Transmission of Culture (helps to keep alive festivals and cultural traditions that have been around from long ago) 32
Maintenance of Regional Society (having employment in farming villages helps to keep people in rural areas) 30
Health and Relaxation (provides a place of relaxation and recreation for people living in cities) 18

Certain of these claims for multifunctionality are mind-boggling in their speciousness. Dragonflies and fireflies are mentioned in both the Kojiki and the Manyoshu (books of oral tradition and poetry compiled in the 7th and 8th centuries), and clearly did not (and still do not) need agriculture to support their environment. Presumably also, in early Japan (as now), water permeated the earth without having to go through a tilled agricultural plot, and the moderating effects of rice paddies on the heat of the summer in country areas nearby isn't going to be much help to sweltering workers in Bit Valley in Shibuya or any other major urban area for that matter.

Having introduced the respondents to these multifunctional wonders of agriculture, respondents were then asked whether they would like to leave agriculture featuring these multifunctional aspects to future generations. Naturally, in response to a motherhood question such as this, the response was overwhelmingly positive. Fifty-five percent of respondents stated that they would Very Much Like to Leave It for Future Generations, with a further 38 percent stating that If Possible, Would Like to Leave Behind for Future Generations. Only a churlish 3 percent were not interested in leaving the wonders of multifunctional agriculture behind for future generations.

As many readers might have surmised by now, the merits of multifunctional agriculture will be a key tactic adopted by the Japanese government in the forthcoming WTO negotiations. Which leads us to the question of how to ensure that multifunctional agriculture is left behind for future generations.

Accordingly, the next question in the survey asks, "In order to leave a multifunctional agriculture for the future, the national and prefectural governments are debating the necessity of providing fixed support to agriculture. There are a number of concrete methods under discussion, and we would like you to tell us which one of these is closest to your thinking."

The results are as shown in Table 3. As can be seen, the highest score (38%) is for increased productivity of farming by fostering skilled farmers able to compete on price and quality with imported products, while the outright introduction of tariffs to act as a brake on imports scores only 10 percent.

Foster skilled farmers capable of competing on price and quality with imported agricultural products 38
Provide subsidies to domestic agricultural products in order to enable them to compete with cheaper imported products 21
Introduce an appropriate combination of measures -- tariffs, subsidies, and fostering of skilled farmers 20
Introduce tariffs, etc., to act as a brake on the import of cheap agricultural products from foreign countries 10
If it requires a financial burden and introducing protectionist measures, then it doesn't matter if multifunctional agriculture is not left to future generations 2

Despite the respondents' desire for greater productivity in agriculture, it is likely that all of these options will simply end up providing the government with more ways to spend taxpayers' money inefficiently. The choice of fostering skilled farmers, i.e., improving productivity, is a logical one for the average Japanese to make given Japan's need for a stable supply of foodstuffs, but, unfortunately, demographics and small farm size make it highly unlikely that such a policy will ever succeed.

According to the 2000 Agricultural Census, only 18 percent of all farm households are actually engaged in full-time farming, and, of these, 53 percent do not have a male under the age of 65 working on the farm.

Excluding Hokkaido, 60 percent of commercial farm households are smaller than 1.0 hectare (about 2.5 acres), with a further 26 percent being between one and two hectares. Eighty percent of commercial farm households have an annual income of less than ¥3 million (about US$26,000), and the average herd size of beef cattle is 24 head.

Respondents were shown a list and were asked which aspects Japan should emphasize in the WTO agricultural negotiations. Ensuring a stable supply of foodstuffs (72%) was clearly the most important factor, and multifunctionality, perhaps helped by the extensive questioning earlier on the topic, came in second with 41 percent (see Table 4).

Ensuring Guaranteed Stable Supply of Foodstuffs 72
Maintenance and Manifestation of Multifunctional Agriculture such as Environmental and Land Protection 41
Establishment of Trade Rules that are Fair and Impartial for all Countries 37
Necessity for Measures such as Fixed Subsidies for the Maintenance of Domestic Agriculture 30
Increased Free Trade by Means of Reductions in Tariffs 17
Necessity for Active Adoption of Biotechnology, such as in Genetically Modified Foods 12

So what does it all mean? Clearly, there is a legitimate concern among both government planners and the population in general about the stability of the food supply. In March 2000, the Japanese government endorsed a basic food plan focusing on guaranteeing a stable food supply to the nation and aimed at raising the calorie self-sufficiency ratio to 50 percent over 10 years. In January 2001, a manual to prepare for the possibility of a major food crisis was drawn up by the government. This assumed a number of possible threats -- abnormal weather in Japan, poor harvests in other countries, a decrease in agricultural production due to global warming, and disruption of world trade by regional conflicts. But, there are serious questions as to whether any of the government's aims can be achieved. As well as demographics and small farm size, there are a number of key factors likely to impede progress. These include the high price of land and an unwillingness to sell farming land passed down from earlier generations.

Importantly, there is also is a lack of political will to effect radical structural change in the agricultural sector, despite the fact that agriculture now comprises only 2 percent of GNP. The ruling LDP coalition relies heavily for its support on a gerrymandered electoral system favoring rural areas. To protect rice farmers, for example, in December 2000, the Japanese government adopted a policy of reducing the (obligatory) amount of rice imported each year agreed to in the Uruguay Round of GATT in 1993. By 2000, the minimum access guarantee was to be 8 percent of total domestic rice demand, but by introducing a punitively high flat rate tariff (which effectively knocked out imports) the need to meet this minimum access guarantee was avoided.

Finally, it is perhaps no coincidence that the MAFF was one of the few ministries to remain untouched by the reorganization of central government ministries that took place on January 6 this year. In short, waiting for endogenous political change in regard to the agricultural sector may be like waiting for Godot.

Japan does have a legitimate need to maintain a minimum agricultural base, and it is hoped that some of the more ridiculous aspects of agricultural multifunctionality will not be trotted out in the forthcoming negotiations. To do otherwise would only serve to undermine its case, much like an earlier case where Japanese snow was found to be different to snow in the rest of the world and therefore not suitable for imported skis.

Hopefully, any funding allocated to help improve the efficiency and competitiveness of Japanese farmers will in fact be used to do so. Some 50 percent of the funds set aside for productivity improvement after the previous GATT negotiations actually went into modernizing roads and water and sewage systems to make rural life more comfortable!!

  • A commercial farm household is defined as one with cultivated land of 30 ares or more (about 0.7 of an acre) or annual sales of agricultural products of ¥500,000 (roughly $5,000) -- hardly a huge enterprise.
  • Among commercial farm households, only 7 percent have a successor aged 15 years or above living with their parents and engaged mainly in farming.
  • Among commercial farm households nationwide (excluding Hokkaido), 60 percent are smaller than 1.0 hectare (about 2.5 acres), with a further 26 percent being between 1 and 2 hectares.
  • The average size of a herd of beef cattle in a commercial farm household is 24 -- which is unlikely to earn a great deal of bragging rights in Texas!

  • William Hall (williamh@isisresearch.com) is president of the ISIS/RBC/CORAL Group, which provides market research and consulting services in Tokyo.

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