Required Report - public distribution

**Date:** 7/23/2003

**GAIN Report Number:** JA3046

JA9990

**Japan**

**Tomatoes and Products**

**Annual**

**2003**

**Approved by:**

![](media/image1.wmf)Kevin Latner

#### U.S.Embassy

**Prepared by:**

Kenzo Ito

**Report Highlights:**

While U.S. round tomatoes are ideal for the food service sector and Roma
tomatoes have captured the consumer's imagination, influencing menu
development and working their way into the Japanese kitchen, more
competition and less market promotion has slowed U.S. tomato sales. U.S.
exports are down almost 55% in 2003, from their 2000 peak, while both
fresh and processed domestic tomato growers step in to take U.S.
producers' lost share.

Includes PSD Changes: Yes

Includes Trade Matrix: Yes

Annual Report

Tokyo \[JA1\]

\[JA\]

Table of Contents

[U.S. Tomatoes -- the Ideal Food Service Tomato
3](#u.s.-tomatoes-the-ideal-food-service-tomato)

[More Competition and Less Marketing Slow Sales of U.S. Tomatoes
3](#more-competition-and-less-marketing-slow-sales-of-u.s.-tomatoes)

[Japanese Imports of U.S. Tomatoes Down 29.6 Percent in 2003
3](#japanese-imports-of-u.s.-tomatoes-down-29.6-percent-in-2003)

[Domestic Growers Started Planting Cooking Tomatoes
4](#domestic-growers-started-planting-cooking-tomatoes)

[Korean Tomatoes Unlikely to Compete with U.S. Tomatoes
4](#korean-tomatoes-unlikely-to-compete-with-u.s.-tomatoes)

[Japanese Production of Tomatoes Declined Marginally in 2002
4](#japanese-production-of-tomatoes-declined-marginally-in-2002)

[Japanese Monthly Import Data of Fresh Tomatoes
5](#japanese-monthly-import-data-of-fresh-tomatoes)

[PS&D Tables and Trade Matrices 6](#psd-tables-and-trade-matrices)

[Fresh Tomato PS&D Table 6](#fresh-tomato-psd-table)

[Fresh Tomato Import Trade Matrix 7](#fresh-tomato-import-trade-matrix)

[Fresh Tomato Wholesale Price Table
8](#fresh-tomato-wholesale-price-table)

# U.S. Tomatoes -- the Ideal Food Service Tomato

The firm texture of U.S. tomatoes makes them perfectly suited for
sandwich-making. The United States continues to successfully supply
round and Roma tomatoes to the Japanese market, targeting mainly Japan's
food service sector. Round tomatoes are mainly used in hamburger chains,
sandwich outlets and hotels, while Romas are popular in Italian
restaurants and for home-cooking. Currently, 80 percent of U.S. tomatoes
sold in Japan are round, with the rest Romas. Although Roma tomatoes are
still relatively new to the Japanese market, they have captured the
consumer's imagination, influencing menu development and working their
way into the Japanese kitchen. Whether Roma or round, U.S. tomatoes
often sell at higher prices than domestic ones. Current prices at
wholesale markets are \$2.52 - \$3.37 (300 -- 400 yen) per kilogram for
U.S. tomatoes and \$2.52 - \$2.94 (300 -- 350 yen) for domestic
tomatoes. In contrast to U.S. tomatoes, which are usually shipped in
25-pound boxes, Japanese tomatoes are packed in 5-kilogram boxes.

# More Competition and Less Marketing Slow Sales of U.S. Tomatoes

Despite rapid market acceptance and changing how the Japanese cook with
tomatoes, sales of U.S. tomatoes declined from lack of market promotion
activities and increased domestic competition. Fresh U.S. tomato imports
to Japan were 689 metric tons (MT) in 2002, down 34 percent from the
previous year. U.S. tomatoes lost ground to domestic producers who
increased production of U.S. tomato varieties. Traditionally, Japanese
growers produced "Momotaro" tomatoes, a pale pink, soft-fleshed tomato,
quite different from U.S. varieties. Responding to U.S. competition,
Japanese growers have shifted to U.S. varieties with firm flesh and
little gel, targeted to the food service sector.

In 1997, the first fresh U.S. tomatoes were introduced in the Japanese
market and sold to Japan's hamburger shops and sandwich stores.
Aggressive marketing of the new-to-Japan product by U.S. tomato growers
and Japanese traders increased shipment to Japan every year until 2000,
to record 1,518 MT, valued at \$4.3 million (CIF). Stalled promotion
activities and increased competition from domestic producers have since
pushed down U.S. imports.

# Japanese Imports of U.S. Tomatoes Down 29.6 Percent in 2003

![](media/image2.wmf)Japanese imports of U.S. tomatoes were 225 metric
tons for January through May 2003, down 29.6 percent from the same
period in 2002, and almost 55% from the 2000 high. Japanese traders
explain that the U.S. product is high quality and discerning buyers
continue to prefer U.S. tomatoes to domestic ones, noting that U.S.
tomato sales would expand if U.S. tomatoes were more price-competitive.
A key factor contributing to higher prices for U.S. tomatoes is
transportation. Approximately 45 percent of U.S. tomatoes were shipped
to Japan by air in 2003. The average CIF price for U.S. tomatoes shipped
by air was \$2.74 (326 yen) per kilogram from January through May 2003,
approximately 30 percent higher than the tomatoes shipped by boat.

# Domestic Growers Started Planting Cooking Tomatoes

As a result of U.S. tomato market efforts opening the food service
sector to tomatoes, Japanese trading companies, which finance Japan's
key convenience-store chains, have started supplying cooking tomatoes to
sandwich manufacturers, whose products are sold Japan's over 40,000
convenience stores. This, combined with recent declines in the price of
"Momotaro" tomatoes, has motivated some tomato growers to shift
production to cooking tomatoes. The average wholesale price of
"Momotaro" tomatoes was \$2.36 (281 yen) per kilogram in 2002 and \$2.51
(299 yen) in 2001. In 2002, cooking tomatoes were commonly traded at
\$2.52 - \$2.94 (300 --350 yen) per kilogram.

Japanese tomato juice and ketchup manufacturers have also expanded into
the cooking tomato market. Ketchup manufacturers have contracted farms
to produce tomatoes for processing and can easily convert their
production to cooking tomatoes. Japan Agricultural Growers Coop (JA) has
also shifted to production of cooking tomatoes. Cooking tomatoes now
make up just under 1 percent of domestic tomato production.

# Korean Tomatoes Unlikely to Compete with U.S. Tomatoes

Korea, the largest exporter of fresh tomatoes to Japan, supplied 3,204
metric tons of tomatoes in 2002. The majority of Korean tomatoes
supplied to Japan were cherry tomatoes, competing with Japanese
production for fresh home consumption, not with U.S. product, according
to Tokyo traders.

# Japanese Production of Tomatoes Declined Marginally in 2002 

Japan produced 784,500 metric tons of tomatoes in 2002, down 2 percent
from the previous year, which were mostly consumed fresh. The Japanese
production of tomatoes for processing use was relatively small at 58,100
metric tons in 2002. Cherry tomato production was 85,600 metric tons,
approximately 11 percent of total tomato production. Japanese production
area for tomatoes was 13,300 hectares in 2002, down 2 percent from the
previous year. Japanese tomato production is expected to decline slowly
in the near future due to the aging Japanese farm population.

In early July, Tokyo's supermarket sold "Momotaro" variety tomatoes at
\$2.35 (280 yen) for a plastic tray of 4 large sized tomatoes and \$3.20
(380 yen) for a bag of 7 medium sized tomatoes. Roma tomatoes,
advertised as tomatoes for cooking, were sold at \$2.35 (280 yen) for a
bag of 5 Romas in the Italian section of the supermarket. Cherry
tomatoes were sold at \$1.26 (150 yen) in a clamshell container with 12
pieces.

# Japanese Monthly Import Data of Fresh Tomatoes

  ---------- -------------- ------- ------- ------- ------- ------- ------- -------
  World                                                                      
  Trade                                                                     
  Atlas                                                                     

  Japan -                                                                    
  Imports                                                                   

  Fresh                                                                      
  Tomatoes                                                                  
  (in Metric                                                                
  Tons)                                                                     

  2000       Country        Jan.    Feb.    Mar.    Apr.    May     Jun.     

             World          1489    1622    1871    1498    923     323      

             South Korea    1292    1500    1756    1413    833     229      

             United States  169     110     101     65      68      78       

             Canada         0       0       1       9       6       6        

             Netherlands    0       0       1       6       14      8        

             New Zealand    26      11      12      4       0       0        

             Country        Jul.    Aug.    Sep.    Oct.    Nov.    Dec.    Total

             World          274     226     579     1344    1309    1558    7726

             South Korea    59      41      403     1135    1156    1457    7023

             United States  200     169     148     183     129     90      591

             Canada         5       12      17      20      16      3       22

             Netherlands    8       3       11      4       3       0       29

             New Zealand    0       0       0       1       3       7       53

  2001       Country        Jan.    Feb.    Mar.    Apr.    May     Jun.     

             World          1516    1374    691     389     323     164      

             South Korea    1444    1282    605     305     242     46       

             United States  65      89      73      64      65      106      

             Canada         0       0       13      20      14      8        

             Netherlands    0       0       0       0       1       4        

             New Zealand    6       3       0       0       0       0        

             Country        Jul.    Aug.    Sep.    Oct.    Nov.    Dec.    Total

             World          255     217     817     1341    1278    1080    4733

             South Korea    65      73      738     1251    1195    1002    4259

             United States  171     128     68      75      72      69      412

             Canada         13      13      10      14      11      7       55

             Netherlands    6       4       1       0       0       0       5

             New Zealand    0       0       0       0       0       1       0

  2002       Country        Jan.    Feb.    Mar.    Apr.    May     Jun.     

             World          463     433     332     340     257     121      

             South Korea    413     380     250     277     164     85       

             United States  47      50      78      59      86      29       

             Canada         3       4       4       4       7       7        

             Netherlands    0       0       0       0       1       0        

             New Zealand    1       0       0       0       0       0        

             Country        Jul.    Aug.    Sep.    Oct.    Nov.    Dec.    Total

             World          189     200     566     452     465     373     1569

             South Korea    91      109     429     318     371     318     349

             United States  59      51      69      52      56      53      29

             Canada         39      40      68      76      37      0       1

             Netherlands    0       0       0       6       0       0       1

             New Zealand    0       0       0       0       1       1       2

  Source of                                                                  
  Data:                                                                     
  Japan                                                                     
  Customs                                                                   
  ---------- -------------- ------- ------- ------- ------- ------- ------- -------

# PS&D Tables and Trade Matrices

## Fresh Tomato PS&D Table

  ------------------ ------------ ---------- ---------- ---------- ---------- ----------
  **PSD Table**                                                               

  **Country**        **Japan**                                                

  **Commodity**      **Fresh                                       (HA)(MT)   
                     Tomatoes**                                               

                     2001         Revised    2002       Estimate   2003       Forecast

                     USDA         Post       USDA       Post       USDA       Post
                     Official     Estimate   Official   Estimate   Official   Estimate
                     \[Old\]      \[New\]    \[Old\]    \[New\]    \[Old\]    \[New\]

  **Market Year                   01/2001               01/2002               01/2003
  Begin**                                                                     

  Plnt For Fresh     0            12606      0          12493      0          12420
  Consump                                                                     

  Plnt For           0            894        0          807        0          730
  Processing                                                                  

  TOTAL Area Planted 0            13500      0          13300      0          13150

  Harv. For Fresh    0            12606      0          12493      0          12420
  Cons.                                                                       

  Harv. For          0            894        0          807        0          730
  Processing                                                                  

  TOTAL Area         0            13500      0          13300      0          13150
  Harvested                                                                   

  Fresh Sale         0            735400     0          726400     0          716000
  Production                                                                  

  Processing         0            62200      0          58100      0          54000
  Production                                                                  

  TOTAL Production   0            797600     0          784500     0          770000

  TOTAL SUPPLY       0            797600     0          784500     0          770000
  ------------------ ------------ ---------- ---------- ---------- ---------- ----------

## Fresh Tomato Import Trade Matrix

  -------------------- ----------------- ---------------- ----------------
  **Import Trade                                          
  Matrix**                                                

  **Country**          Japan                              

  **Commodity**        Fresh Tomatoes                     

  Time Period          Jan. - Dec.       Units:           Metric Tons

  Imports for:         2001                               **2002**

  U.S.                 1048              U.S.             690

  Others                                 Others           

  South Korea          8252              South Korea      3204

  Canada               125               Canada           289

  New Zealand          11                Netherlands      6

  Netherlands          15                New Zealand      2

                                                           

                                                           

                                                           

                                                           

                                                           

                                                           

  Total for Others     8403                               3501

  Others not Listed    0                                  1

  Grand Total          9451                               4192
  -------------------- ----------------- ---------------- ----------------

## Fresh Tomato Wholesale Price Table

  -------------------- ----------------- ---------------- ----------------
  **Prices Table**                                        

  **Country**          Japan                              

  **Commodity**        Fresh Tomatoes                     

  Prices in            Yen               per uom          KG

                                                          

  Year                 2002              2003             \% Change

  Jan                  241               292              21%

  Feb                  247               347              40%

  Mar                  331               415              25%

  Apr                  333                                -100%

  May                  244                                -100%

  Jun                  212                                -100%

  Jul                  225                                -100%

  Aug                  316                                -100%

  Sep                  321                                -100%

  Oct                  286                                -100%

  Nov                  449                                -100%

  Dec                  283                                -100%

                                                          

  Exchange Rate        118.66            Local            
                                         Currency/US \$   

  Date of Quote        6/4/2003          MM/DD/YYYY       
  -------------------- ----------------- ---------------- ----------------