"A top priority for our association is to market Iowa pork and strengthen relationships with major importers of U.S. meat, as well as expand our pork markets into other countries," said Scott Tapper, Chair of the IPPA Foreign Market Development Committee.

While in Japan, the delegation traveled to Tokyo and Osaka, where the group called on nine major companies, the U.S. Embassy, the U.S. Agricultural Trade Office and affiliated organizations. Discussions during the meetings looked at food safety and trends in the meat industry.

During a briefing at the U.S. Embassy in Tokyo, Richard Battaglia, Agricultural Attache, and other U.S. government officials, presented the challenges and opportunities of Japan's agricultural production. Battaglia said that Japan's population is approximately 127 million people, which is less than one-half of the U.S., while Japan is about the size of California and only about 8% of the land is arable.

Challenges facing Japan include an aging population and fewer young people going into farming. In addition, the more marginal farmland in the country is coming out of production. Approximately 60% of Japan's food is imported and Battaglia said the government's target is to bring it down to 50%.

U.S. pork sales to Japan, our number one customer in terms of value, set new dollar and tonnage records in 2004 with exports of 313,574 metric tons at a value of $978.5 million.

"The high level of pork sales to Japan is due in part to the substitution of pork for beef as a reaction to the recent occurrence of BSE in the U.S.," said Tapper. "Pork demand is expected to weaken as beef consumption recovers." Japan is about 55% self sufficient in supplying pork to its consumers.

The U.S., which has lost some share of food sales, remains Japan's largest supplier of food at slightly over a 30% share, said Mark Fischer with the Iowa Department of Economic Development. "Some of the lost share is due to the BSE issue and rising competition such as fruits and vegetables from China, which was a factor after the decline of available fruits and vegetables after the hurricanes in the U.S. The weaker U.S. dollar will be helpful in holding market share of food imports," added Fischer.

The U.S. government officials indicated that the BSE issue is occupying a great deal of time, as a framework has been established to allow U.S. beef to be imported into Japan. This framework would allow beef from cattle of 20 months or younger to be imported.

Traceability and the Japanese consumer
The Iowa delegation met with major meat companies and retailers in Japan, where it was clear that traceability is becoming increasingly important to Japanese consumers. The Japanese government has implemented a traceability system for cattle after the discovery of BSE in Japan, and retailers are increasingly using traceability systems for food items to increase their share of sales to consumers.

According to the Japanese retailers, consumers like to know there is a system in place if a problem arises and initial surveys are indicating that Japan's consumers are willing to pay for high quality, safer food with traceability. Another apparent trend among retailers is that the store brands are now becoming the higher end products. However, they predicted that consumers would not pay a premium for traceability alone.

Japanese food marketing trends
During a meeting with Japanese retail and meat representatives, food trends were apparent and similar to trends among U.S. consumers. Japanese consumers are looking for more convenience with more take-home prepared foods, and additionally, they want more information about the food they are purchasing. In response, retailers are offering meat and produce with photographs of the producer family or company on point-of-sale signage and on-pack labeling.

In other areas of food marketing, convenience stores and hotels are now advertising take-out foods. Ethnic foods are becoming more popular, and the mixing of Western and Asian foods is becoming increasingly common. Additionally, 100-yen stores (approximately one dollar) are successful in Japan as consumers are looking for better value.