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THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARIL... - page 4 / 38

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As the Japanese population is predicted to decline due to a low birth rate, the Japanese food market is expected to diminish in the future. Food retailers and food service operators are competing for consumers on a number of fronts, including price, convenience, variety and safety. Some companies are seeking a way to survive in the industry through mergers and acquisitions or tie-ups with partners beyond their traditional business channels.

U.S. Advantages and Challenges The Japanese market offers a number of benefits to U.S. exporters, but it is not without difficulties. To put these

opportunities in perspective, here is a list of the most important U.S. advantages and challenges: Table 1. Advantages and Challenges

U.S. Advantages

U.S. Challenges

Strong yen versus weak dollar U.S. food cost/quality competitiveness Wide variety of U.S. products - including fresh, ingredients, and processed foods Reliable supply of U.S. agricultural products Advanced U.S. food processing technology Relatively low U.S. shipping costs Science-based U.S. food safety procedures Growing Japanese emulation of U.S. cultural and food trends Japanese food processing industry seeking new ingredients Changes in the Japanese distribution system, becoming similar to that of the U.S. High dependence on foreign food supply Higher farming costs in Japan

Increasing food safety concerns and demands for food production information among Japanese consumers Declining price competitiveness Distance from Japan Consumer antipathy toward biotech foods and additives Japanese preoccupation with quality Consumers‘ preference of domestically produced products (image problem with imported food in general) High cost of marketing in Japan Complicated labeling laws High duties on many products Increasing competition with China and other food exporting countries Exporters are often expected to commit to special contract requirements and long-term involvement

II. Exporter Business Tips The following are suggestions on exporting food products to Japan.

Tips to Start Up

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