Ayako Sato, 48, is happy when she gets comments from customers in the correspondence section of money transfer forms.

Ever since her 50-year-old husband, Tsukasa, established a company in 1994 to ship rice directly to customers, Ayako has never failed to write letters every month to buyers.

Tsukasa came up with the idea of setting up the company, Tsukasa Farm, when he sent rice to relatives in 1993, when the country suffered a crop failure.

He received 3.2 hectares of rice paddies from his father when he set up the company. At the same time, he bought 8.4 hectares of farmland.

The Satos, who live in the city of Sakata, Yamagata Prefecture, now have 18 hectares of paddies and grow rice under the Sasanishiki and Haenuki brands. In addition, they produce soybeans on another 5.7 hectares.

Tsukasa Farm has succeeded in doubling its rice shipments to 108 tons over the past six years and in increasing the number of customers from 10 to about 180. Sales have risen more than 10 million yen to 32 million yen.

However, running the business is not easy, Tsukasa said. He has invested 150 million yen in the company since it was established. Its annual deficit has run at around 2.5 million yen in the last four years.

He wants to expand the scope of his business, but buying more farmland is not economically viable.

“The big-scale farm has limits with the wholesale price of rice shipped by general farm households now set at about 14,000 yen per 60 kg,” he said.

There has been no major progress nationwide in expanding the scale of farm operations by agricultural households. The area of land plowed by the average farming household with more than 500,000 yen in sales is 1.6 hectares.

The number of families with larger farmland — more than 4 hectares in Tokyo and other prefectures and more than 50 hectares in Hokkaido — is growing. However, they cannot keep up with the rapidly changing agricultural environment.

Tsukasa Farm can resolve the deficit problem if it can get 7 additional hectares for cultivation under contract. It currently operates 7.8 hectares of such land.

Social attitudes are the reason for the lack of growth in the area of land plowed under contract, Sato said. Many farmers are reluctant to commission their land to others to plow because they do not want their neighbors to think they have failed.

However, opportunities for expanding the scope of agricultural operations are growing. About 30 percent of domestic farming households are comprised of people aged 65 or older and it is possible that such households may increasingly give up their land in the future.

“I have the facilities to plow 50 hectares of land,” a bullish Tsukasa said. “The next two or three years will tell whether I am going to win or lose.”

Thanks to the sale of rice on consignment to customers, Tsukasa Farm has managed to keep its rice price steady, dropping only 50 yen per kg in the past six years.

The Satos maintain ties with their customers by trying to make their product stand out in the crowd. They polish their rice, which contains few agrochemicals, immediately before shipping it to their customers in order to maintain a good taste.

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