Tohoku fruit producers look to overseas markets for growth
As Japan’s domestic consumption of goods is set to drop due to a declining population, the government is now turning to overseas markets for the nation’s farm products, aiming to expand annual agricultural exports to ¥5 trillion in 2030.
Fruits produced in Japan, which are highly valued worldwide, could be the key to increasing exports. Fruit producers in the Tohoku region are seeking ways to cultivate new markets and expand their sales channels overseas.
India opened its market for Japanese apples in March this year. With the world’s second largest population of 1.3 billion, India is expected to overtake China as the world’s most populous country as early as next year, with a growing number of wealthy people. Aomori Prefecture, which boasts Japan’s largest production of apples, has started to test its product in the new market.
At the end of August, a tasting event for Japanese fruits was held at a high-class restaurant in the capital New Delhi. According to the Japan External Trade Organization (JETRO), which hosted the event, local chefs praised the taste and shape of Aomori apples.
Japan’s exports of agricultural, forestry, fisheries and food products totaled ¥1,238.5 billion in 2021. Of that, exports to India accounted for only ¥1.86 billion, or 0.15%. India has strict regulations on food imports, and it had been particularly cautious against invasion of pests and diseases in fruits.
Aomori Trading, a Hirosaki-based trading firm engaged in apple exports, has exported apples to three Indian cities on a trial basis about 10 times since 2020, and had been eagerly waiting for the market to fully open.
“Even if (Aomori apples) are expensive, we can be competitive with our high-quality product,” said Hideo Obori, 51, managing director of Aomori Trading, adding that there is no way to miss out on this huge market with a great potential.
According to a survey by the Agriculture, Forestry and Fisheries Ministry, the percentage of people with a certain income, or the semi-rich and above, in India was 24% in 2018, but the figure is expected to roughly double to 51% in 2030. As more people demand higher quality products, the volume of exports is expected to increase.
Shipments of Aomori apples, which account for 90% of Japan’s apple exports, have hovered at around 30,000 tons in recent years. The main export destinations have been Taiwan and Hong Kong, where large apples are popular as gifts during the Chinese New Year.
The date of Chinese New Year varies from year to year, but it usually falls in January or February. This period is the busiest time for sorting facilities in Aomori Prefecture as both domestic sales and exports peak.
Noting that India has no gift-giving culture during this period, Obori said strong exports without interruption can be expected if exports to India are shifted to March and beyond.
Keiichi Kimura, director of JETRO Aomori, believes that a growing trend of eating healthy food in Europe and the United States is also affecting eating habits in India and that it will in turn have a positive effect on apple exports.
Citing “an apple a day keeps the doctor away” — a well-known saying that originated in Wales — Kimura thinks the British influence, including its food culture, still lingers in India.
“Consumption of apples may also increase thanks to the health boom. High quality Japanese apples will do well,” he said.
The heavy door has finally opened for entry into India. However, due to a lack of market research and the underdeveloped “cold chain” low-temperature logistics in India, producers need to be aware that it will take some time for shipments to increase, experts say.
Satoshi Ishitsuka, professor at Hirosaki University’s Faculty of Agriculture and Life Science, stresses the importance of India when diversifying export destinations. “It is possible that exports to a certain destination suddenly come to a halt due to changes in the world situation. (Having India as an export destination) has a great advantage in terms of risk diversification,” he said.
“A rapid expansion of exports to Taiwan and Hong Kong is unlikely,” Ishitsuka said. “From a medium- to long-term perspective, developing the Indian market is an urgent task.”
In Yamagata Prefecture, one of the world’s largest producers of La France pears, those involved are trying to expand their exports to East Asia.
The fruit has a melt-in-your-mouth sweetness when it is allowed to ripen, and exporters are trying to find ways to convey the appeal of the fruit to overseas consumers and establish the product as a staple in the market, despite challenges stemming from the ongoing coronavirus pandemic.
In November and December last year, Yamagata International Economic Development Support Organization, an affiliate of the prefecture, set up a sales promotion booth at a high-end supermarket in Hong Kong. Due to travel restrictions imposed under the pandemic, however, the organization has been forced to leave the operation of the booth to local staff for the past
Checking photos taken of the stock has been the only way to confirm the quality of exported fruit and the reaction of consumers.
Before the pandemic, team leader Moto Urushibara and Yamagata farmers stood in stores overseas to directly promote their pears. When they appealed to wealthy Hong Kong consumers by saying, “It goes well with white wine and prosciutto,” some of them put the fruits in their shopping baskets.
Urushibara, who felt the positive response in Hong Kong, stresses the importance of face-to-face sales. “If you don’t directly convey the message through tastings and other means, people won’t pick it up,” he said. This season, he plans to visit export markets to promote the product himself.
According to a survey by the prefecture, the volume of La France and other Yamagata pears shipped to the East Asian region was 7 tons in the latest fiscal year ended in March, the lowest since fiscal 2016 when the prefecture started to release comparable data. Of the exports, the largest 4 tons were shipped to Hong Kong. Amid the sluggish shipments, producers have started full-scale projects to increase exports.
JA Tendo, the agricultural cooperative based in the city of Tendo, Yamagata Prefecture, began domestic shipments of La France pears for the season on Oct. 19. It has about 400 growers who cultivate about 1,600 to 1,700 tons of La France per year. Last year, several hundred kilograms were shipped to Hong Kong and Taiwan. The cooperative also introduced its own Super La France brand, which meets standards for size and sugar content, to emphasize the high quality of its products.
This summer, JA Tendo established an export promotion council with traders from other prefectures. The council is studying ways to expand sales channels for La France and other fruits, as domestic demand is expected to shrink due to the declining population. The council will hold study sessions for growers to share information on fruit standards required overseas.
One of the barriers to the expansion of overseas sales channels is the lack of consensus on the “best time to eat” for the fruit, which isn’t agreed upon even in Japan. “Overseas, there is a strong belief that pears should be hard,” one exporter said. Past sales indicate that while fully ripe La France is accepted in Hong Kong, there is resistance to softness in Malaysia.
Yoshiyuki Tsuchiya, 49, head of the pear division at JA Tendo, feels that La France is “an unusual fruit,” for having different preferences on the timing of consumption.
Tsuchiya remembers a reaction from a visitor to Yamagata from the Asian region who tasted La France for a TV program several years ago. The visitor enjoyed a hard, less sweet pear before harvest, saying, “It’s delicious just as it is.”
Akira Yamaguchi, 42, manager at JA Tendo Foods, a subsidiary of JA Tendo, said, “Until now, we have recommended in our leaflets to eat them when they are fully ripe, but that may not necessarily be right.”
Exporters are considering various ways to expand sales by trying to find out preferences of consumers in export destinations and strategies needed for each region.