The Cabinet on May 24 endorsed a white book on agriculture for fiscal 2011. It gives priority to reviving agriculture in the coastal areas of the Tohoku region devastated by the 3/11 disasters. The region suffered damages amounting to ¥2.426 trillion, about 27 times that caused by the 1995 Kobe earthquake.
Only 39 percent of the affected agricultural land has been restored. Another point included in the white paper is a call for farmers to expand their operations to engage in processing of agricultural products and distribution and sale of agricultural products in addition to agricultural production.
Attention should be paid to the fact that Japan’s agricultural products such as fruits and vegetables are of high quality. If farmers are keen to the needs of consumers and able to supply agricultural products wanted by consumers in a consistent manner, they can expect to increase their profits. These days many consumers want agricultural products that are organically produced and are chemical free.
Japan’s agriculture finds itself in a difficult situation. The number of farmers is on the decline as their average age increases. If Japan takes part in the Transpacific Partnership free trade zone, they will be exposed to harsh competition. But as more manufacturers move their production bases to foreign countries and the employment situation in local economies becomes difficult, agriculture can play an important role in creating jobs.
The government needs to seriously consider ways to revitalize the agricultural sector and farming communities so that they can ensure sufficient incomes for workers, thus making agriculture more attractive to people who are looking for jobs.
If farmers can expand their activities to include processing of agricultural products as well as the distribution and sale of agricultural products, they can diversify the sources of their income as well as increase their incomes. Such activities will also shorten the psychological distance between agricultural producers and consumers. It will be important for farmers to push product differentiation and to acquire the know-how needed for marketing and running a business.
The government-backed Japan Finance Corp. is expected to supply funds to help farmers develop new products and expand distribution channels. The government and successful entrepreneurs should help farmers acquire business management know-how.