SETANA, Hokkaido (Kyodo) A large tractor motors along, digging up a sprawling pasture on a hilltop here to convert it into a farm.

“We are going to sow organic soybeans on the entire (roughly 60-hectare) farm,” said Satoshi Takeuchi, managing director Watami Food Service Co., which operates the Watami chain of “izakaya” pubs and restaurants in Hokkaido and other parts of Japan.

Watami signed a business management contract in March with the Setana town office, which was recognized under Prime Minister Junichiro Koizumi’s deregulation program as the nation’s first organic dairy special zone.

Under the contract, Watami Food will grow organic vegetables without using any agrochemicals and chemical fertilizers, and instead rely on compost and rice bran.

Watami Food will also breed 40 diary cows in the special zone.

It plans to switch to organic grains produced in the United States in the summer to feed the cattle.

The “organic” milk will be used to make ice cream for a door-to-door delivery service and cheese for its outlets.

Watami has succeeded in rapidly expanding the scope of cultivating its own brand of organic vegetables by signing contracts with farmers.

Taking farm households’ incomes into consideration, it agreed to buy all cultivated vegetables at a fixed price, unaffected by market ups and downs.

It received guidance on cultivation, accumulated its own knowhow on growing vegetables and rented land from farmers.

Watami’s appeal to consumers is that it can hold the prices of organic vegetable dishes 20 percent to 30 percent below those of other restaurants by eliminating the cost of middlemen.

Meanwhile, Naoya Kakizoe, president of Nippon Suisan Kaisha Ltd., said his fishery firm’s venture into growing young yellowtail in Kushima, Miyazaki Prefecture, has opened “one of the possibilities” for consistency in fish production in Japan.

It manages the country’s largest site that artificially grows young yellowtail. It is capable of shipping a million fully grown yellowtail a year.

Yellowtail fry are caught in waters about 3 km off Kushima and are raised in fish ponds with feed produced at the company’s factory in Imari, Saga Prefecture.

The company also processes fully grown yellowtail in the facility located next to the feed manufacturing factory and sends them out across the nation.

Nippon Suisan used to sell fry and feed to cultured fish growers, buy back adult fish and market them.

A company official said this system had limited ability to ensure food safety because outside people took part in raising the fish.

It acquired cultured fish facilities at the end of April from a bankrupt company.

Tomoyuki Maebashi, president of Kuroshio Suisan Ltd., Nippon Suisan’s local subsidiary, said the fishery firm has completed a system to deliver to consumers goods that are “completely under management with clear historical production data on feed and medicines.”

Nippon Suisan hopes to complete the system of consistent output of yellowtail in the next five years by replacing natural fry with those artificially hatched from eggs of disease-resistant fish.

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