Voluntary Report - public distribution

**Date:** 9/28/2006

**GAIN Report Number:** JA6519

JA6519

**Japan**

**Market Development Reports**

**Food Business Line**

**- Periodic Press Translations**

**2006**

**Approved by:**

![](media/image1.wmf)Michael Conlon, Director, ATO Tokyo

Agricultural Trade Office

**Prepared by:**

Juri Noguchi, PR Specialist, ATO Tokyo

**Report Highlights:** Lawson Inc. will open new-style convenience
stores targeting older consumers. Three major convenience stores (Lawson
Inc., Family Mart Co., Ltd. and Circle K Sunkus Co., Ltd.) recently
announced that they would work together in planning and sales of
products to take countermeasures against the largest convenience store
in Japan, Seven-Eleven Japan Co., Ltd. The first Seiyu under Walmart's
ownership opened in June in Sendai. Imported beer, especially European
beer influenced by the recent interest in the World Cup, is becoming
popular in Japan because of its unique flavor.

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

Tokyo ATO \[JA2\]

\[JA\]

![](media/image2.png){width="0.7423611111111111in"
height="0.6381944444444444in"}

**Food Business Line** *Periodic Press Translations from ATO Tokyo Vol.
VI, Issue 6, June 1-July 31,
2006*![](media/image2.png){width="0.7423611111111111in"
height="0.6381944444444444in"}

# Retail/Wholesale 

-   Under *Daiei Inc's*. revitalization plan, the company will finish
    closing 54 outlets by the end of June. The company is also planning
    additional closings through the end of February 2007 because of slow
    sales. (a. 6/28)

-   The group sales for *Seven & I Holdings Co., Ltd*. from March-May
    2006 increased by 16% compared to the same period last year. Their
    new subsidiary, *Millennium Retailing Co., Ltd,* contributed to this
    growth in sales, while their convenience stores and supermarkets
    also gained in profitability. (a. 6/22)

-   *FamilyMart* established the system to support obtaining "ISO9001"
    for their contract manufacturers of HMR and box lunches. All
    facilities are targeted to obtain this designation by the end of
    February 2008. (b. 6/16)

-   *Lawson Inc.* will open new-style convenience stores targeting older
    shoppers. They will sell Japanese tea, traditional cakes and bento
    box lunches, and set up tables and massage chairs so that the
    customers can eat, drink and enjoy visiting the store. (a. 6/24)

-   *Lawson Inc.* announced its new strategy to "promote the health of
    the Japanese people." They will sell low-pesticide vegetables
    produced by contract farmers while partnering with the Japan Sports
    Association. (g. 6/22)

-   *Lawson Inc.* will sell 16 popular confectionary items on the
    *Rakuten Ichiba* internet website *from* June 27-July 10. Lawson
    Inc. also sells these confectionary items at 60 "Natural Lawson"
    outlets*. Lawson* and *Rakuten* are planning more collaboration in
    the future. (f. 6/29, b. 6/21)

-   *Aeon Co., Ltd.* will be the first retail company to adopt European
    GAP standards, which is a system to certify the safety of
    agricultural products in Europe. The Japanese company will
    strengthen and supplement their own standards for private brand
    products to make them compatible to European GAP standards. The
    purpose of this change is to set more rigid food safety standards
    and to establish a path for sharing information with Europe. (b.
    7/5)

-   According to the results of retail survey in 2005, the top 10 groups
    for sales volume are *Aeon, Seven & I Holdings, Daiei, Yamada Denki,
    Uny, Seiyu, Takashimaya, Mitsukoshi, Daimaru,* and *Isetan.* There
    have been no changes in the list except for the inclusion of *Seven
    & I Holdings,* which holds stocks of *Ito-Yokado* and *Seven-Eleven
    Japan*. (b. 6/28)

-   *Circle K Sunkus Co., Ltd,* a major convenience store, announced
    that they have started the "Think Body" project to supply
    nutritionally balanced Bento box lunches and desserts in
    collaboration with *Avex Group Holdings,* a major music publishing
    and entertainment company. (g. 7/4)

-   *The Aeon Group* started an experimental new small-sized food
    supermarket "My Basket." Located in these new supermarkets will be
    the take-out box lunch company *Origin Toshu Co., Ltd*., which was
    recently purchased by the Aeon Group. (f. 7/20)

-   *Lawson Inc.* will open new-style convenience stores under the
    "Happy Raising Children Project," targeting parents of small
    children. They will sell products and services to match targeted
    customers' preferences. The idea for the project was a housewife who
    won the grand prize at Lawson's "Think of Future Convenience Store"
    to commemorate their 30^th^ anniversary in 2005. (g. 7/11)

-   Three major convenience stores (Lawson Inc., Family Mart Co., Ltd.
    and Circle K Sunkus Co., Ltd.) recently announced that they would
    work together in planning and sales of products to take
    countermeasures against the largest convenience store in Japan,
    Seven-Eleven Japan Co., Ltd. The three companies will start with
    soft drinks and may gradually expand to liquor and processed food
    items. The purpose of this alliance is to take countermeasures
    against the largest convenience store, *Seven-Eleven Japan Co.,
    Ltd,* by decreasing the cost of procurement and improving the profit
    rate and quality of products. (g. 7/13)

-   Major supermarkets are beginning to manufacture their own take-out
    foods. *York Benimar,* for example, established a new factory to
    manufacture sushi and take-out foods. *Ito-Yokado Co., Ltd.*
    established its own factory by using the know-how of *Seven-Eleven
    Japan,* which will enable them to develop original products to match
    their customers' tastes and attract more housewives and older
    customers while keeping a high profit ratio. (a. 7/8)

-   The first Seiyu under Walmart's ownership opened in June in Sendai.
    Walmart renovated the store at a low cost and introduced an
    automatic supplement system for the first time in Seiyu. (f. 7/3)

-   Ryoka Japan Ltd., a subsidiary of Ryoshoku Co, Ltd., will increase
    confectionery imports to 3 billion yen by December 2007 and to 4
    billion yen by December 2009. U.S. brands are to be added in the
    fall of 2006. (b. 7/31)

-   *Marubeni Corporation* announced that they purchase 33.6% of Daiei's
    issued shares from *The Industrial Revitalization Corporation of
    Japan (IRCJ).* This makes Marubeni the largest stockholder of Daiei.
    (b. 7/31)

# Food Service 

-   *Don Quijote Co., Ltd*., a general discount store chain, will work
    with HMR consulting company Deli System Planning to start new-style
    convenience stores in August. Don Quijote has been looking for an
    alternative partner since they failed to buy the bento take-out
    lunch and HMR chain *Origin Toshu Co., Ltd.* They will open
    approximately 10 outlets in Tokyo and its suburbs to sell bento
    take-out lunch and sozai HMR. (a. 6/30)

-   A hamburger chain *Freshness* will start in July a retail business
    featuring convenience type stores called "Freshness Natural Market,"
    which will feature health food. The stores will sell USDA NOP
    organic foods and almost 150 imported food items and household
    items. Domestic items will be added in 2007. (b. 6/16)

-   *Royal Holdings Co., Ltd*. restaurants increased the use of locally
    produced vegetables. They started from *Royal Host* and *Sizzler*
    restaurants in Kanto and Tokai Regions, and will expand to other
    regions in Japan. The reason for this move is to improve the
    freshness and reduce expenses. (b. 6/7)

-   *Denny's Japan* will start selling allergen free cakes baked with
    rice powder and soy cream. *Denny's Japan* will not use eggs, wheat
    or dairy products in their cakes. (b. 6/7)

-   According to the 2005 financial statement of major yakiniku
    beef-bowl chain restaurant, business improved due to their strategy
    of using an alternative beef supply from Australia and China. For
    example, the sales of *Zensho Group*, which owns the *Sukiya* beef
    bowl restaurant chain, was up almost 300 percent from last year. (b.
    6/5)

-   According to a recent survey conducted by Nikkei Shimbun newspaper,
    only 7.4% of 54 major food service and retail companies relied that
    they will use U.S. beef right after the ban is lifted. Four
    companies including Gyudon beef-bowl chain *Yoshinoya D&C* and
    Yakiniku Korean barbeque chain *Zenshoku Co., Ltd*. replied that
    they would use U.S. beef once it's available because they believe in
    the high quality, the excellent taste and the safety of U.S. beef.
    27.8 % of the respondents stated they would probably use U.S. beef
    soon after the ban was lifted. However, 50% replied that they would
    not use U.S. beef for a while because they have established a system
    of using Australian beef or because they still think there are
    questions about safety. Among those who replied "will use" 41.7%
    were food service companies while only 22.2% were retailers.
    Retailers tend to survey housewife customers, who tend to be more
    conscious about U.S. beef. (b. 6/23)

-   According to the *Japan Food Service Association's* report on total
    sales of restaurants in June, the total sales of the member
    restaurants on the same store basis increased by 0.4% compared to
    the same month of last year. It was the fourth consecutive
    increasing month. (b. 7/26)

-   *Hanamasa Co., Ltd*., a food service wholesale supermarket, will
    open about 30 new stores in the Tokyo metropolitan area, which will
    double the amount of stores they have. (b. 7/17)

# 

# Food Processing/New Products/Market Trends

-   According to the 2005 *Ministry of Public Management's* report on
    national census, the number of people older than 65 in the
    population was 26,820,000, which was an increased of 21.9% from the
    previous 2000 report. The ratio of people older than 65 in the total
    population increased to the world's highest level of 21.0%, while
    the population of people younger than 15 decreased to the world's
    lowest level of 13.6%. (a. 6/30)

-   *Kikkoman Co., Ltd*. will start in the chilled drink business in
    July aiming at the expanding chilled drink market. "DelMonte"
    vegetable and fruit juices/drinks will be the leading items sold at
    supermarkets and convenience stores. (a. 6/23)

-   *Mercian Corporation* started "Casual Wine By Order" supply system
    targeting volume retailers and supermarkets. The price ranges from
    500-700 yen and the company only imports only the amount that was
    ordered. (b. 6/5)

-   Drink manufacturers and retailers are developing new ways to
    increase the demand for vegetable juice such as creating recipes
    using vegetable juice and supporting seminars to promote the health
    benefits of vegetables at primary schools. (b. 6/19)

-   *Nagatanien Co., Ltd*. and *House Foods Corporation,* two major food
    manufacturers, will start producing chilled prepared foods to sell
    at major supermarkets targeting single households and older
    consumers. (a. 6/16)

-   According to a report by *SGS Japan Inc.*, an inspection and
    certification organization, the SQF (Safe Quality Food)
    certification is becoming popular, especially among meat business
    companies. Twenty-four companies obtained SQF certification as of
    the end of June, nineteen of which are meat business companies. The
    SQF is the international strict food safety and quality management
    standards started in Australia. (b. 7/3)

-   A major baking company, *Yamazaki Baking Co., Ltd*., announced that
    they acquired *Tohato Inc*. They are planning to place *Tohato and*
    *Yamazaki Nabisco Co., Ltd*. as the core confectionery businesses,
    with a target of total sales of 1 trillion yen, but analysts believe
    that the company cannot expect significant growth in their core
    bread business. (a. 7/4)

-   The price of seafood is increasing at supermarkets. The retail price
    for tuna has increased by 20-30% since this spring because of the
    projected decrease of imports due to the fishing regulations. Demand
    for white meat fish such as salmon and flounder has expanded in
    Europe due to people's anxiety over meat consumption after the BSE
    outbreak and in China due to its continuing economic growth. The
    high price will continue for a while because of the world's tight
    supply of marine resources. (a. 7/12)

-   Imported beer, especially European beer influenced by Japan's
    interest in the World Cup, is becoming popular because of its unique
    flavor. Department stores have expanded the space for imported beer,
    and stores that carry imported beer have flourished. Belgium and
    German beer are the most popular imported beer. (a. 7/15)

-   The price for ham and sausages will increase due to the increased
    price for package materials caused by the high crude oil price. (b.
    7/17)

-   Sparkling wines and sparkling Sake have become popular in Japan.
    They attract female consumers by their casualness and refreshing
    taste. (a. 7/29)

-   "UDF" (Universal Design Food) food for people who has minor
    difficulties in biting or drinking, has started to be recognized by
    the Japanese market, and as such, many manufacturers have increased
    sales of UDF food. The market size is currently estimated at 12
    billion yen, but should in the coming years it should accelerate
    because major manufacturers are planning to enter into the UDF
    market. (f. 7/20)

-   According to Japanese shipping statistics, in the first half of 2006
    total shipments increased by 1.1% compared to that of 2005 for the
    five major beer companies. This was the first increase during the
    first half of the year in five years. *Kirin Brewery Co., Ltd*. has
    a market share of 37.6% for the first time in five years. (a. 7/12)

-   A major seafood wholesaler, *Kamewa Shoten,* has been certified as
    the first MSC (Marine Stewardship Council) handler in Japan and
    started supplying MSC labeled products at several supermarkets in
    Tokyo, including *National Azabu Supermarket*. *Kamewa* started
    producing \"MSC salmon rice cracker\" on a test basis to educate
    consumers, and a fisherman\'s union in Kyoto prefecture is planning
    to acquire MSC certificate for snow crabs. (a. 7/10)

-   Demands for beef has declined in both retail and food service
    industry. According to the report, the unseasonable weather and the
    reaction to an abnormal high market price before the Golden Week in
    May lowered demand. (f. 7/3)

-   *Suntory Ltd*. and *Kao Corporation* are competing with each other
    for the top sales item of "Food for Specific Health Uses." *Kao'*s
    "Healthya" tea/water and *Suntory's* "Kuro Oolong Tea" both claim to
    control the absorption of fat. (g. 7/30)

# 

# Food Safety/Consumer Awareness 

-   A month has passed since the new MRL positive list system started.
    Violations were found only in the limited items of some fresh
    vegetables from China, Thailand and Belgium, and in eels (5) from
    China. While a considerable confusion was expected, the Japanese
    food industry took it as a quiet start. (f. 6/29)

-   "Shokuiku" (food education) has been popular among retail stores
    with sales promotion for fresh vegetables. Recipes and visual
    materials to promote vegetables to mothers and children are now at
    several supermarkets. (b. 7/31)

# ATO/Cooperator/Competitor Activities/Trade Shows 

-   *Almond Board of California* reported the results of research that
    showed eating almonds regularly can control the increase of level of
    blood sugar and cholesterol. (f. 6/22)

-   *Raisin Administrative Committee* announced that they established
    May 1 as the "California Raisin Day" to commemorate the 45^th^
    anniversary of their Japan office. (f. 6/8)

-   *USMEF* will hold the "2006 American Pork Seminar" in Tokyo, June
    15, to update importers on the production of U.S. pork and the
    trends on retail merchandising, etc. (f. 6/12)

-   *USMEF* held the final competition of "American Pork Original Recipe
    Contest" in Tokyo, June 11. Twelve consumer finalists participated
    in the competition to be judged by two famous cooking school
    representatives. (f. 6/19)

-   *SOPEXA* held the "Day of Aperitif" event in Tokyo with over 3,500
    people. They set the first Thursday in June as "Day of Aperitif" to
    introduce the French culture of "aperitif". Similar events were held
    in the various cities in Japan. "Aperitif" is a simple, informal way
    to enjoy conversation, food, champagne, and spirits.  "Day of
    Aperitif" gives people around the world an opportunity to
    re-discover and share French food culture. (f. 6/8)

-   Obtaining a license for liquor sales will be fully liberalized in
    September. Supermarkets and convenience stores that were restricted
    in selling liquor will be able to obtain a license, and the number
    of stores that will sell liquor for the first time will increase.
    (b. 6/16)

-   *The California Walnut Commission* held "Walnut convention" and "The
    17^th^ California Walnut New Products Development Contest Award
    Ceremony" in Tokyo. (f. 7/20)

-   *The Raisin Administrative Committee* held "2006 California Raisin
    Menu Idea Contest Award Ceremony" with the theme of "California
    Raisin Menu You Want to Eat Everyday". (f. 7/27)

-   Specialty cheese from the United States will start appearing in the
    Japanese market. *U.S. Dairy Export Council* held a seminar and
    tasting to introduce U.S.'s specialty cheese to the Japanese market.
    (f. 7/3)

-   *USMEF* held "American Pork Cooking Class - Italian Menu Using US
    Pork and Vegetables from Kyoto by Chef Yasuhiro Sasajima" in Tokyo.
    50 consumers participated in the event. (f. 7/3)

-   Mr. Gregory Hanes, the new Japan Director of *USMEF*, who was
    interviewed by a reporter from The Food Industry News reporter, said
    that the most important key for the future of U.S. beef would be the
    recovery of trust, and that they would conduct campaigns targeting
    consumers and the meat industry in Japan to let them know how U.S.
    beef is produced safely and with care. (f. 7/24)

-   *Meat and Livestock Australia (MLA)* and *Osaka Cookers'
    Association* held "Tasty Meat Cooking Using Aussie Beef & Lamb
    Seminar" at the Tsuji Cooking School Technical Research Center. 136
    chefs and cookers participated in the event. (f. 7/3)

** Sources **

\(a\) The Japan Economic Newspaper (b) The Nikkei Marketing Journal

\(c\) The Japan Food Journal (d) The Beverage & Food News Commentary

\(e\) The Japan Food News (f) The Food Industry News

\(g\) Fuji Sankei Business I (h) Pan News

\(i\) Nihon Keizai Shimbun

DISCLAIMER - *Food Business Line* is derived from major Japanese news
wires, mass distribution press, and food industry newspapers and
magazines. Inclusion of an item in *Food Business Line* does not imply
agreement by USDA or U.S. Embassy/Tokyo; nor does USDA or U.S.
Embassy/Tokyo attest to the accuracy or completeness of the translation
of the news item. ATO Tokyo cannot further translate or send source
materials to users.