Japan wheat trade continues even in disaster’s wake

BakingBusiness.com, March 22, 2011
by Jay Sjerven

Bookmark and Share

Even as Japan struggled to recover from the devastating impact of a horrific earthquake and tsunami and tried frantically to contain a possible nuclear disaster, essential wheat trade with the nation continued. Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) announced on March 17 it purchased 32,381 tonnes of Canadian western red spring wheat for May shipment to fill its regular weekly wheat tender. A week earlier, also as part of its weekly tender program, the ministry purchased 135,823 tonnes of wheat for May shipment, including 34,917 tonnes of U.S. western white wheat and 28,887 tonnes of U.S. hard red winter wheat with the remainder of the tender split between Canada and Australia.

Japan is one of the world’s largest wheat importers having to buy from other nations around 90% of its food wheat requirements. Japanese farmers do produce wheat with the nation’s 2010 outturn estimated at 567,800 tonnes and the 2009 crop estimated at 674,600 tonnes. To supplement the small domestic crop, Japan imported 5,502,000 tonnes of wheat in 2009-10, according to the U.S. Department of Agriculture.

In most recent years, Japan has vied with Nigeria as the largest buyer of U.S. wheat. In 2009-10, Japan purchased 3,297,000 tonnes of U.S. wheat, according to the U.S.D.A., compared with 3,256,000 tonnes bought by

Nigeria in that year. The U.S. share in the Japanese import wheat market was 62% in 2009-10 with Canada and Australia splitting the remainder.

Most of the imported wheat enters Japan through the state trading system administered by the MAFF. The ministry imports types of wheat suitable for the primary consumer needs. In the case of U.S. wheat, western white wheat is used in the manufacture of confectionery products while hard red winter wheat and hard red spring wheat are used for bread and Chinese-style noodles.

The MAFF controls both producer and resale prices of domestic and imported wheat, according to the U.S.D.A. The MAFF buys imported wheat at international prices and sells it to domestic flour millers at a markup, which recently was around twice the international price. The MAFF buys domestic wheat at a high price and sells it to domestic millers at a significantly lower price, lower than imported wheat so the lower-quality domestic wheat will be accepted. Revenues from transactions for imported wheat are used to help cover the cost difference between the purchase and resale of domestic wheat.

The Japanese market for wheat was considered “mature” with per capita consumption flat at around 31.5 kgs annually. In comparison, in recent years, Japanese per capita consumption of rice was around 60 kgs.

Bookmark and Share
Add a Comment
We welcome your thoughtful comments. Please comply with our Community rules.
Email Address:
The views expressed in the comments section of BakingBusiness.com do not reflect those of BakingBusiness.com or its parent company, Sosland Publishing Co., Kansas City, Mo. Concern regarding a specific comment may be registered with the Editor by clicking the Report Abuse link.
Enter code as it is shown (required):