Miller Magazine Issue: 122 February 2020

JAPAN 81 MILLER / FEBRUARY 2020 years, however, competition has increased from alter- nate suppliers such as China, Australia, Thailand, Canada, and Brazil. With the recent implementation of the CPTPP agreement and the EU-Japan Economic Partnership Agreement, competition is expected to further increase. SELF-SUFFICIENT IN RICE Rice is by far the most important crop in Japan. It is the primary staple food of the Japanese diet and of such fundamental importance to the Japanese culture. The cultivation of rice has shaped the politics, economy and culture of the country. Rice accounts for one-quarter of the daily calorific intake per person in Japan. Unlike oth- er crops, Japan is self-sufficient in rice and hence, it is considered symbol of independence. According to The United States Department of Agriculture’s (USDA) GAIN report released in September 2019, total rice production is expected to increase to 7.8 million metric tons (MT) in the 2019/20 season. MY2018/19 consumption is ex- pected to decrease to 8.5 million MT due to an anticipat- ed reduction in table rice consumption and feed use. A combination of population decline and a downward trend in per capita consumption is reducing overall table rice consumption. The Ministry of Agriculture, Forestry and Fisheries (MAFF) estimates that the pace of consumption decrease for table rice has accelerated in recent years, which is partly attributable to a year-on-year increase in the market prices of table rice since 2016. Feed consumption is also expected to decrease in MY2018/19 due to decreased domestic feed rice produc- tion and decreased government sales of Minimum Access (MA) rice and reserves for feed. Processing continues to drive demand for MA rice and reserves. Due to continued declines in domestic feed rice production and sales of MA rice for feed, USDA forecasts MY2019/20 feed consump- tion to decrease further. Seeking convenience, Japanese consumers are eating more ready to eat rice in lieu of preparing rice at home. Production of sterilized packaged cooked rice has been steadily increasing and increased 5.7 percent to 170,000 MT (product volumes) from 2017 to 2018. Overall, pro- duction of processed rice products increased 4.6 percent to 390,000 MT in 2018, up 20 percent from 2013. How- ever, the tread of increased consumption of packaged rice is not expected to overturn overall table rice consumption declines. Demand for rice for processing has been stable as increases in exports of sake and rice crackers offset decline in domestic consumption of these products. Ac- cordingly, USDA forecasts MY2019/20 rice consumption to decrease to 8.4 million MT as demand for table rice and feed is anticipated to weaken. Through MAFF’s promotion efforts, Japanese commer- cial rice exports continue to grow year over-year. With the projected increase in the commercial rice exports, total exports are forecast to increase to 65,000 MT in MY2018/19 and to 70,000 MT in MY2019/20. WHEAT IMPORTER Japan is one of the largest wheat importing countries in the world. The United States, Canada, and Australia are suppliers to the Japanese wheat import market. Ja- pan’s imports of U.S. wheat were valued at $793 million in 2018. Japan is the United States’ largest export mar- ket for wheat, based on value. Two countries signed the U.S.-Japan Trade Agreement on October 7, 2019. In this agreement, Japan will provide a duty-free CSQ for wheat that grows from 120,000 metric tons to 150,000 metric tons over six years. Japan will reduce its markup on im- ported U.S. wheat by 45 percent over eight years, match- ing the same levels for CP-TPP suppliers. For processed wheat products such as biscuits, cookies, crackers and other bread products, which face import tariffs as high as 26 percent, Japan will eliminate existing tariffs in five years. For uncooked spaghetti and macaroni, Japan will reduce the existing 30 yen/kg tariff by 60 percent over eight years.