Business / Economy

Seafood a sweet spot in Japanese exports as yen weakens

by Keiko Ujikane and Aya Takada

Bloomberg

Seafood is a sweet spot in Japanese exports this year that is pushing sales of food abroad to a record and gaining strength as the yen weakens.

Food shipments increased every month this year through September as the yen fell 4 percent, putting them on course to exceed the all-time high of ¥436 billion in 2013.

That contrasts with total exports from Japan, which haven’t recovered to their 2008 peak, even as data Wednesday showed increases for motor vehicles, ships and steel.

Demand in Asia and the Middle East for everything from Japanese scallops to the finest cuts of tuna for sashimi is spurring seafood sales that account for about 40 percent of food exports.

While cars, machinery and electronics remain powerhouses for Japan, food shipments mean jobs in rural areas and are vital to the Abe administration’s regional revitalization.

“There is no doubt that we’re getting a tailwind from the weaker yen,” said Tatsuya Fujishiro, a director of Koyo Trading Ltd., a Tokyo-based exporter of more than 200 food products including soybean paste, sake and about 60 varieties of fish.

Overseas sales, accounting for 60 percent of Koyo’s revenue, rose to a record in the fiscal year through March, he said.

The yen dropped to 110.09 per dollar this month, the weakest point since August 2008, intensifying debate about its impact. The currency is forecast to weaken to 114 to the dollar by the end of 2015, according to the median of estimates compiled by Bloomberg.

Many manufacturers, including automakers Honda Motor Co. and Toyota Motor Corp., have already moved a large amount of production overseas, reducing some of the positive effect of exchange rates on exports.

That’s not the case for fishing and farming, noted Masahiko Ariji, an associate professor at Kinki University’s agriculture faculty in Nara Prefecture. The weak yen is a “golden chance” for exports and jobs for regional and rural economies that face aging and declining populations, according to Ariji.

While agriculture, forestry and fisheries account for less than 2 percent of gross domestic product, they employ about 4 percent of the nation’s workforce, data from labor ministry show.

Prime Minister Shinzo Abe has set a goal of increasing the value of annual food exports to ¥1 trillion by 2020 as he seeks to arrest the demographic decline across the country.

Shipments in this category reached ¥336 billion in the nine months through September, 9 percent higher than the same period in 2013, according to figures from the Finance Ministry.

Without enough land to compete with farmers on the plains of the U.S., Brazil and Australia, and pressure to roll back its agricultural tariffs, Japan is looking to fisheries, as well as niche markets ranging from premium beef to fruit and sake.

As overfishing reduces catches on the open seas, Japan is also increasing efforts to farm tuna and other fish.

Kinki University has succeeded in raising tuna from eggs spawned by farmed fish and has entered a venture with the Toyota Tsusho Corp. trading company to start mass farming of bluefin tuna hatchlings.

The university has sold farmed fish to the U.S. and is considering opening a sushi restaurant in New York to promote its tuna. It already has a shop in Osaka and another in Tokyo’s Ginza district.

The Azuma-Cho Fishery Cooperative, based in Kagoshima Prefecture, said demand for its farmed Japanese amberjack is increasing, particularly in Southeast Asia.

The cooperative, which started exporting farmed amberjack to the U.S. in 1982, has expanded its shipments to more than 20 countries, including Germany, China and Saudi Arabia, said Deputy Director Katsuhisa Kane.

Tokyo’s Tsukiji fish market, the nation’s biggest seafood-trading hub, is considering acting as an export agent for its members as they pursue sales overseas.

Trial shipments are planned to start next year, with Vietnam as the first destination, said Naohide Kametani, an executive director at the Wholesales Co-Operative of Tokyo Fish Market, which represents about 700 traders at Tsukiji.

Hiroshige Seko, Abe’s deputy chief Cabinet secretary and the grandson of Kinki University’s founder, is one of the strongest advocates of seafood and agriculture shipments abroad.

“The weakening yen is definitely providing a boost,” Seko said. “We have good chance right now with Japan’s food exports.”

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