Supply/Demand Basics

  • Corn use: feed 75%; starch 24%; other food use 1%.
  • #2 import market for U.S. corn and U.S. barley, #5 for U.S. sorghum in MY 2018/2019.
  • Feed grain imports gradually declining to 12-15 MMT/year from 16 MMT/year.
  • Japan imported 560 TMT of U.S. DDGS in MY2018/2019.
  • Dry milling sector’s U.S. corn market share keeps 100% in MY 2018/2019.

Country Overview

  • Population / growth: 127 million / -0.2%
  • Urban % / growth: 94.3% / 0.15%
  • GDP / growth: $5.4 trillion / 1.5%
  • GDP per capita: $42,700
  • Large government debt and stagnant economy; highly subsidized, small agricultural sector; dependent on imported raw materials and fuels.
  • Prime Minister Abe holds the Prime Minister position for the seventh year, the second longest after the war.

Trade and Market Share Overview

  • Aging population and changing consumer preferences mean little growth in total food demand.
  • High health consciousness with relatively high income has led to demand for health-oriented, value-added foods.
  • Still committed to buying from U.S. (volume, reliability, origination investments), however Japanese industry beginning to diversify sources of feed ingredient imports.
  • 216 million gallons of ethanol blended as ETBE, at 2% blend rate. The U.S. can hold up to 44% market share.

Policy Overview

  • U.S.-Japan bilateral trade agreement should be taken as a trigger to revitalize agricultural policy and trade establishment.
  • Biotech approval system, while functioning, may not have capacity to handle accelerating applications.
  • Japan’s biofuel policy has allowed U.S. bioethanol since 2018.There is a ceiling for the U.S. bioethanol market share at 44.4% due to GHG emission reduction requirement.