Japan runs short of butter as dairy farms dwindle
Tokyo: When Japanese pose for pictures, instead of saying “Cheese!” some say “Butter!” These days, butter is more likely cause for frowning, since it is rationing that comes to mind.As the Christmas Eve cake rush
Tariffs on imports of farm produce average 23 percent. Overall, the government pays a subsidy to dairy farmers of 12.8 yen (11 cents) per kilogram for butter and 15.41 yen (13 cents) per kilogram for cheese.
Dairy farmers like Shinjiro Ishibashi, who is raising about 300 head of cattle on his farm in Chiba, east of Tokyo, count on the support. Japan's farm lobby remains a stronghold for the ruling Liberal Democratic Party, which while talking up sweeping reforms is also reassuring farmers it will continue to look after their interests.
“Mr. Abe says he will preserve our ‘beautiful Japan,' and I expect him to do it,” said Ishibashi, alluding to Abe's constant praise for Japan's traditional farming lifestyle.
Japan's farm protection policies are one reason the 12 nations negotiating a U.S.-led trans-Pacific trade pact have been unable to reach an agreement. Negotiators meeting in Washington this week look likely to end another year without a consensus.
Among the countries negotiating the trade pact, Japan has the second largest food market after the U.S. and foreign dairy and other farmers are eager for more access.
But “sacred territory” issues such as pickup trucks for the Americans and beef, pork, dairy, sugar and rice in Japan have frustrated efforts to reach an overarching agreement.
A Japanese government study estimated that opening farm markets under the trade pact could reduce domestic farm output by about 2.7 trillion yen ($22.5 billion), or over 40 percent of total farm, fisheries and forestry production.
But a report by the U.S. Department of Agriculture questioned that figure, saying it does not take into account issues such as supply constraints in other countries. The USDA report estimated that market liberalization for dairy products could boost Japan's butter imports by about half, to about 6 billion yen (over $50 million).
Japan's Agriculture and Livestock Industries Corp., or ALIC, which is overseen by the farm ministry, buys and sells products through an open and online bidding process, to help ensure stability of prices and supplies, in effect subsidizing loss-making farmers and manufacturers.
The system, meant to ensure stable supplies, appears to be failing to do that, at least for butter.
Japan's raw milk output in the fiscal year ended in March was 7.45 million tons, down from an industry peak of just over 8.6 million tons in 1997. Butter consumption per person has held steady, at about 2 kilograms (4.4 lbs) for about a decade, while milk consumption has been falling.
Apart from the emergency imports, four major local dairy companies were ordered to increase output of butter for home use by 30 percent in early December, reducing drinking milk and cream production, the farm ministry said.
It said it would do everything possible, beginning next year, to stabilize supplies.
A victory for Abe in Sunday's election could give him at least two more years, and possibly more, to tackle such issues, said Uri Dadesh, an associate with the Carnegie Endowment for International Peace.
“Whether he will do the structural reforms is a different matter,” he said in a conference call with reporters. “Let's remember that this is a man who already has a massive majority of the parliament on his side.”