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Quick Stats

Quick Stats

Organics Dashboard From Passport

  • The organic segment in Japan is led by artisanal brands with a value share of 25.1% in 2019, followed by Alce Nero Gruppo with a value share of 4.1% and Takanashi Dairy Co Ltd with a value share of 2.2%.
  • Japan ranks 13th in market size globally with a value of US$591.3 mn in 2019. However, the market is expected to record marginal growth of 0.2% for the forecast period 2019-2024, with market size of US$596.3 mn, leading to a rank of 47th in forecast growth.

  • Organic products in Japan recorded a market size of US$591.3 mn in 2019, representing 1.2% of global demand and roughly 12.5% of demand in the Asia Pacific in 2019.
  • With weak economic growth and a low level of awareness on the benefits of organic products, the category is expected to record slow growth, with a forecast value CAGR of 0.2% for the period 2019-2024.
Qualitative Analysis

Qualitative Analysis

Quick Facts
  • Organic packaged food and beverages in Japan witnessed a value growth of 0.3% over 2018-2019 to record a market size of US$591.3 mn in 2019.
  • Growth in organic packaged food was led by organic breakfast cereals as well as organic nuts, seeds and trail mixes, both of which recorded current value growth of 3.0% in 2019
  • Organic beverages as a whole witnessed a 1.0% decline in current value terms in 2019, recording a market size of US$202.0 mn. Organic coffee saw the slowest current value drop of 1.0% in 2019, compared for instance, to the decline witnessed by organic soft drinks of 2.9%.
Market Trends
  • Organic beverages are currently a niche category, with consumers primarily unaware of the added value provided by organic variants. Consumers are more likely to differentiate between products based on origin, with a preference for the locally produced options, indicating that organic products are still at a rather low priority.
  • Despite the availability of natural organic stores such as Natural House and F&F Organic Food, producers prefer to sell their products online due to a lower overhead cost, making e-commerce, which recorded a share of 40.6% in 2019, the prime distribution channel for organic products.
Competitive Landscape
  • Artisanal players led value sales of organic packaged food, mainly driven by their dominance in organic bread. Several small bakeries in Japan specialize in offering organic bread options, catering to the relative niche demand for organic products. Overall, the market remains fragmented, with larger brands struggling to gain consumers' confidence.
  • Among brands with a significant value share, Nichifutsu Boeki is the largest, with a share of 6.2% in 2019. The success of the brand is attributed to the popularity of its Italian imported Alce Nero brand of organic pasta. Besides its strong heritage, the brand is also supported by the rising popularity of Italian cuisine in Japan.
  • The investment of AEON Japan, a corporate retail group, into private-label organic offerings under its Topvalu range has helped provide volume growth and product availability of organic beverages. The more affordable prices allow consumers to have higher product accessibility. The company has also had an expansion of its product range to include organic coffee and tomato juice, as well as an increase in the number of its Bio c' Bon organic supermarkets, suggesting private label has the potential to influence organic products in Japan profoundly.
Prospects And Growth Opportunity
  • Increasing promotional efforts from manufacturers to educate consumers on the value offered by organic variants are expected to be a highly influential driver towards stimulating volume demand. Furthermore, investment in manufacturing technology and a rise in private label offerings make organic products more affordable among Japanese consumers.
  • Consumers in Japan prefer domestically produced goods rather than large global brands' products. Local players such as AEON retail leverage this trend, with an increase in their distribution of organic fresh fruit and vegetables and organic packaged food. The company has also established an agricultural subsidiary to manufacture organic ingredients. Additionally, the company has also reorganized its Topvalu Green Eye organic brand into free from and natural product lines, to further customize its offerings for specific consumer preferences.
General Health And Wellness Trends
  • Consumers in Japan are becoming increasingly health conscious, with a growing concern on the potential impact of artificial ingredients and additives on their health. This increasing health consciousness is of consumers has helped maintain the demand for health and wellness products in Japan despite a contracting consumer base.
  • There is specifically a growing popularity for naturally healthy products, in subcategories of packaged food and beverages such as RTD tea, bottled water, high fiber food, rice and olive oil. However, there are still significant challenges with naturally healthy fruit/vegetable juices hit by concerns of sugar content and NH tea suffering competition from beverages that are more compatible in terms of the demand for convenience among busy consumers.
General Economics And Demographic Landscape

Economy:

  • The economy of Japan is expected to witness weak growth in 2020, recording a GDP growth of 0.6% post gains of 1.1% in 2019. A major driver for the slowdown is the hike in sales tax from 8.0% to 10.0% in 2019, limiting consumer spending.
  • Private final consumption witnessed a growth of 0.9% in 2019, with virtually no growth expected in 2020. Additionally, unemployment is expected to increase to 2.5% in 2020 from its 2019 level of 2.4%. As a response to the ageing population, Tokyo has launched a new approach to immigration, which would allow for 500,000 guest workers to ease labour shortages.
  • GDP growth is expected to remain slow for the coming years, with growth expected to hit 0.7% in 2021 and to remain at 0.6% annually through 2027.

 Population demographics:

  • The population of Japan had begun to fall in 2009, as a result of a low fertility rate and population ageing. In 2018, the population stood at about 126 million, about 800,000 less than the total in 2000. The ageing of the Japanese population is dragging economic performance, with the median age in Japan of 48.2 years higher than other large economies in the region.
  • The proportion of the population over the age of 65 years is expected to increase from 28.5% in 2019 to about 31.0% by 2030. The government forecasts that about half the population will be of retirement age by 2050.
  • The fertility rate in 2019 was recorded at 1.4 births per female and is expected to remain at this rate through 2030.
     

Income & expenditure:

  • The savings ratio in Japan amounted to 9.9% of disposable income in 2019, with the indicator expected to dip to 9.8% in 2020.
  • Consumer expenditure per capita in 2019 amounted to US$22,309, with the indicator expected to grow by 0.2% in 2020. For the period 2020-2030, spending on medical goods and services, as well as on communications is expected to record the highest share of consumer expenditure.
  • Disposable income per capita was recorded at US$24,251 in 2019 and is expected to grow by less than 0.1% in 2020. For the period 2020-2030, disposable income is expected to increase by an annual average rate of 1.5%.
Data

Data

Organic Packaged Food And Beverage Data

Data type

Unit

2016

2017

2018

2019

2020

2021

2022

CAGR
(16-19)

CAGR
(20-22)

Health & wellness products consumption

USD million

52,191.6

52,921.6

53,549.9

53,690.1

54,205.1

54,752.0

55,289.3

0.9%

1.0%

Organic packaged food and beverages consumption

USD million

589.5

588.6

589.4

591.3

592.3

593.5

594.7

0.1%

0.2%

Organic packaged food consumption

USD million

375.9

379.3

384.6

389.3

393.3

396.9

400.0

1.2%

0.8%

Organic beverages consumption

USD million

213.6

209.3

204.8

202.0

199.0

196.7

194.7

-1.8%

-1.1%

Organic packaged food and beverages consumption as a % of total health & wellness products consumption

%

1.1%

1.1%

1.1%

1.1%

1.1%

1.1%

1.1%

-

-

Economic And Demographic Data

Data type

Unit

2016

2017

2018

2019

2020

2021

2022

Total population

million

126.9

126.7

126.4

126.1

125.7

125.3

124.9

% Middle and upper class of total population

%

29.8

29.0

28.3

28.1

27.9

27.8

27.7

% Population aged 65+

%

27.3%

27.7%

28.1%

28.5%

28.8%

29.1%

29.2%

% Population aged 0-14

%

12.4%

12.3%

12.2%

12.1%

12.0%

11.9%

11.9%

% Population with higher education degrees

%

32.0

32.5

33.0

33.5

33.9

34.3

34.7

Average number of children per household

children

0.4

0.4

0.3

0.3

0.3

0.3

0.3

GDP per capita

USD per capita

38,703.5

39,522.9

39,694.2

40,331.6

39,842.7

40,445.7

40,817.1

Consumer expenditure per capita (US$)

USD per capita

21,114.8

21,453.3

21,745.2

22,067.7

22,113.0

22,270.6

22,512.7

Consumer expenditure per capita on food and non-alcoholic beverages (US$)

USD per capita

3,285.5

3,336.0

3,354.7

3,334.3

3,374.0

3,441.8

3,480.9

Retailer And City Data

Top 5 Cities By Population

Data category

Rank

City/retailer

Population
(millions)

Top cities by population (2019)

1

Tokyo

37.5

Top cities by population (2019)

2

Osaka

19.1

Top cities by population (2019)

3

Nagoya

9.2

Top cities by population (2019)

4

Fukuoka

5.5

Top cities by population (2019)

5

Shizuoka

2.7

Top 5 Grocery Retailers By Sales

Data category

Rank

City/retailer

Top grocery retailers by sales (2019)

1

Seven & I Holdings Co Ltd

Top grocery retailers by sales (2019)

2

FamilyMart Co Ltd

Top grocery retailers by sales (2019)

3

Lawson Inc

Top grocery retailers by sales (2019)

4

AEON Group

Top grocery retailers by sales (2019)

5

LIFE Corp

United States Department Of Agriculture Global Agricultural Trade System Data

Top 5 Export Commodities To Japan

Year

Country

Rank of
Product/Commodity

Product/Commodity

Export Value (US$)

2019

Japan

1

Organic Lemons Fr/Dr

11,153,077

2019

Japan

2

Organic Grapes Fresh

8,076,597

2019

Japan

3

Organic Strawberries Fresh

6,711,414

2019

Japan

4

Organic Cherries Fresh

5,344,062

2019

Japan

5

Organic Berries Fresh

3,557,889

2019

Japan

Total

Total Organics*

52,813,757

2018

Japan

1

Organic Strawberries Fresh

7,650,086

2018

Japan

2

Organic Cauliflower Fr/Ch

6,218,956

2018

Japan

3

Organic Grapes Fresh

3,930,320

2018

Japan

4

Organic Cherries Fresh

3,869,119

2018

Japan

5

Organic Berries Fresh

3,859,047

2018

Japan

Total

Total Organics*

40,107,913

2017

Japan

1

Organic Strawberries Fresh

6,730,594

2017

Japan

2

Organic Cauliflower Fr/Ch

3,814,369

2017

Japan

3

Organic Berries Fresh

2,869,580

2017

Japan

4

Organic Lettuce Not Head Fr/Ch

1,781,123

2017

Japan

5

Organic Tomato Sauce Ex Ketchp

1,745,974

2017

Japan

Total

Total Organics*

22,306,806

2016

Japan

1

Organic Cauliflower Fr/Ch

8,075,190

2016

Japan

2

Organic Grapes Fresh

6,434,602

2016

Japan

3

Organic Strawberries Fresh

6,199,819

2016

Japan

4

Organic Berries Fresh

3,229,633

2016

Japan

5

Organic Lettuce Not Head Fr/Ch

2,994,310

2016

Japan

Total

Total Organics*

35,836,911


Note : Total organics is the sum of all exports in a particular year  
Definitions

Definitions

Term

Definition

Health and Wellness

Health and wellness is the aggregation of organic packaged food and beverages, fortified/functional packaged food and beverages, naturally healthy packaged food and beverages, better for you packaged food and beverages and food intolerance products.

Organic packaged foods and beverages

This category includes packaged food & beverages that are certified organic by an approved certification body. Organic production is based on:

• A system of farming that maintains and replenishes soil fertility without the use of toxic and persistent pesticides and fertilizers.
• Organic food & beverages are minimally processed without artificial ingredients, preservatives or irradiation.
• The use of GMOs (Genetically Modified Organism) is prohibited. “Certified Organic” means the item has been grown according to strict uniform standards that are verified by independent state or private organizations.
• Depending on the country, such products are called ‘organic’, ‘biological’ or ‘ecological’: For organic products to be included under Euromonitor definitions, the organic aspect needs to form part of positioning/marketing of the product. This is an aggregation of organic baby food, bakery, confectionery, dairy, ice cream, oils and fats, ready meals, rice, sauces, dressings and condiments, snack bars, soups, spreads, sweet and savory snacks and other organic food.

Note that fresh food products or individual ingredients are not included in this definition.

Compound annual growth rate (CAGR)

The compound annual growth rate (CAGR) is the average annual growth rate over a specified period of time. For instance, the CAGR consumption of from 2016 – 2019 will be the average growth rates across these three years.

USDA GATS data clarification

The data presented in table 2.4 represents the dollar values of the top 5 organic commodities as well as of the total organic exports of the trade partner for the period 2016-2019 as per the United States Department of Agriculture’s Global Agricultural Trade System, a database consisting of international agricultural, fish, forest and textile products trade statistics dating from the inception of the Harmonized coding system in 1989 to present.

Policy Information

Policy Information

Government Agency(s) / Competent Authority

Authorized Government Agency(s):

Ministry of Agriculture, Forestry and Fisheries (MAFF)

Agency(s) Contact Information:

1-2-1, Kasumigaseki
Chiyoda-ku, Tokyo 100-8950, Japan
Website

Organic Regulations and/or Standards

Name(s) of Regulation and/or Standard:

Japan and the United States have an Equivalency Agreement which began January 1, 2014.

Organic Japanese Agricultural Standard (JAS) and Technical Criteria (website in English)

Date of Implementation: 2000

Regulation and/or Standard Scope:

The standards cover plants, processed foods, livestock feed, and livestock products, as well as transportation, selection, processing, cleaning, storage, packaging, and other post-harvest processes for domestic and imported products.

Imported Products

Importers must be certified. Technical criteria for importers cover facilities, methods for acceptance and storage of imported product, qualifications and number of persons in charge of acceptance and storage of imports and for those in charge of grading labeling, and for attaching grading labels. Japan has approved rules and standards of some countries as equivalent with the Organic JAS system. The equivalent grading system of another country does not mean that it is identical to the Organic JAS system. The integrity of the Organic JAS system is maintained through setting the terms of exports to Japan for crucial differences between both grading systems.

The United States has an Equivalency Agreement with Japan

Certification and Accreditation

Accreditation Method:

Government

Accreditation:

MAFF accredits certifiers.
The United States has an Equivalency Agreement with Japan.

Additional Information

Reference Standards:

https://gain.fas.usda.gov/Recent%20GAIN%20Publications/Japan%20Regional%20Retail%20Foods_Osaka%20ATO_Japan_12-21-2018.pdfBased on Codex Guidelines for the Production, Processing, Labelling and Marketing of Organically Produced Foods

Additional Information:

Japan is on the EU's third country list.

USDA’s GAIN Report US-Japan Organic Equivalency Arrangement Expanded to Include Animal Products (2020)
USDA’s GAIN Report Japan Introduces a New JAS Logo for Differentiated Products (2018)
USDA’s GAIN Report Japan Proposes Date to Extend Organic Label to Animal Products (2018)
USDA’s GAIN Report Japan Regional Retail Foods (2018)
USDA's GAIN Report Japanese Organic Market (2017)
USDA’s GAIN Report Japan HRI Food Service Sector Report (2019) 
USDA’s GAIN Report The Japanese Processed Fruit Market-Opportunities and Challenges (2017)
USDA’s GAIN Report An Overview of the Food Labeling Standard (2017)
USDA’s GAIN Report Revised Country of Origin Labeling Requirements for Ingredients (2017)
USDA’s GAIN Report Japan Revises Organic Law Allowing Imported Organic Feed (2017)
USDA’s GAIN Report Japan Change to Country of Origin Labeling Requirements Notified (2017)
Agricultural Trade Office talk: Food, Agriculture, and U.S. Market Prospects: Agriculture in Japan (March 6, 2017)
USDA's GAIN Report Japan Exporter Guide (2020)
USDA's GAIN Report Japan Food Processing Ingredients (2020)
USDA's GAIN Report Japan Retail Foods Retail Sector (2020)
USDA's GAIN Report Organic Seminars in Japan (2015)
USDA's GAIN Report Japan Translates Amended Japanese Agricultural Standards Act (2019)
USDA's GAIN Report Japan Food and Agricultural Import Regulations and Standards Country Report (2020)
USDA's GAIN Report Japan Food and Agricultural Import Regulations and Standards Export Certificate Report (2020)
USDA's GAIN Report Japan Food and Agricultural Import Regulations and Standards - Narrative (2015) 
USDA's GAIN Report General Instructions for Shipping Product Samples to Japan (2020)
USDA's GAIN Report Japan Health Foods Market Overview (2020)