Required Report - public distribution

**Date:** 9/27/2004

**GAIN Report Number:** JA4073

JA4073

**Japan**

**Livestock and Products**

**Annual Report**

**2004**

**Approved by:**

![](media/image1.wmf)Richard Battaglia

U. S. Embassy

**Prepared by:**

Kakuyu Obara

**Report Highlights:**

Japan's beef supply situation expected to remain tight in 2005, assuming
the ban on U.S. beef continues. Imports from Australia and New Zealand
are expected to increase in 2005, but the supply shortfall will remain.
Domestic production is anticipated to rise by 1% due to strong demand
and increased numbers of animals at slaughter age. Pork consumption
expected to remain strong in 2005 at 2.473 million MT, supported by the
absence of U.S. beef, and ongoing bans on poultry from China and
Thailand. Pork imports are expected to ease however due to high stocks.
Imports from the United States are forecast to increase slightly due to
solid demand for chilled pork in the food service industry.

Includes PSD Changes: Yes

Includes Trade Matrix: No

Annual Report

Tokyo \[JA1\]

\[JA\]

Table of Contents

[Beef Section 3](#beef-section)

[2005 Market Outlook 3](#market-outlook)

[Supply Deficit, Low Consumption, and High Prices in 2005
3](#supply-deficit-low-consumption-and-high-prices-in-2005)

[Japan's Beef Safeguard a Concern in 2005
3](#japans-beef-safeguard-a-concern-in-2005)

[Table 1. Japanese Beef Safeguard Monitor
4](#table-1.-japanese-beef-safeguard-monitor)

[2004 Situation Update and Outlook Summary
4](#situation-update-and-outlook-summary)

[Table 2. Japanese Monthly Household Consumption of Beef, Pork And
Chicken
6](#table-2.-japanese-monthly-household-consumption-of-beef-pork-and-chicken)

[Table 3. Japanese Monthly Ending Beef Stock Estimates
6](#table-3.-japanese-monthly-ending-beef-stock-estimates)

[Table 4. Japanese Beef Imports for January - June 2004
7](#table-4.-japanese-beef-imports-for-january---june-2004)

[Table 5. Japanese Imports of Prepared and Processed Beef Products
8](#table-5.-japanese-imports-of-prepared-and-processed-beef-products)

[Pork Section 10](#pork-section)

[2005 Market Outlook 10](#market-outlook-1)

[Solid Consumption Expected to Reduce Stocks
10](#solid-consumption-expected-to-reduce-stocks)

[Pork Safeguard Unlikely in 2005 10](#pork-safeguard-unlikely-in-2005)

[Table 6. Japanese Pork Safeguard Monitor for the Past Three Years
11](#table-6.-japanese-pork-safeguard-monitor-for-the-past-three-years)

[Pork TRQ Under FTA with Mexico Expected to Begin in 2005
12](#pork-trq-under-fta-with-mexico-expected-to-begin-in-2005)

[2004 Situation Update and Outlook Summary
12](#situation-update-and-outlook-summary-1)

[Table 7. Japanese Wholesale Price of Domestic Pork Carcass in Tokyo
Market
13](#table-7.-japanese-wholesale-price-of-domestic-pork-carcass-in-tokyo-market)

[Table 8. Japanese Monthly Ending Pork Stock Estimates
14](#table-8.-japanese-monthly-ending-pork-stock-estimates)

[Table 9. Japanese Pork Imports for January -- June 2004
14](#table-9.-japanese-pork-imports-for-january-june-2004)

[Table 10. Japanese Imports of Prepared and Processed Pork
16](#table-10.-japanese-imports-of-prepared-and-processed-pork)

[Cattle PS&D Table 17](#cattle-psd-table)

[Beef PS&D Table 18](#beef-psd-table)

[Swine PS&D Table 19](#swine-psd-table)

[Pork PS&D Table 20](#pork-psd-table)

The 2005 livestock market outlook projections are based on the
assumption that Japan's import ban on U.S. beef due to BSE will remain.
This assumption does not reflect any USDA position on ongoing trade
discussions. Post will make revisions as developments warrant. Please
also note that imports of prepared and processed beef and pork products
are incorporated into the import and consumption figures in the PS&D
tables. The factor used to convert product weight equivalent (PWE) to
carcass weight equivalent (CWE) for beef and pork is 1.43 (1/0.7), which
is used in Japan's official livestock statistics. Conversion factors
(PWE to CWE) for prepared and processed products are 1.79 (1/0.56) for
beef and 1.43 (1/07) for pork. Unless specified, volumes are on a CWE
basis. Regarding the discussion of the beef and pork safeguards, customs
clearance and product weight equivalent figures are used as reported by
the Government of Japan (GOJ).

# Beef Section

## 2005 Market Outlook

### Supply Deficit, Low Consumption, and High Prices in 2005

Japan's 2005 total beef consumption, including imported prepared and
processed products, is projected at 1.116 million MT, a slight decline
from 2004, and well below levels prior to the detection of BSE in Japan
in 2001. Assuming that Japan maintains its import ban on U.S. beef,
Japan's beef market will continue to suffer from a huge supply deficit,
similar to the situation in 2004. This will continue to hurt the food
service industry, a large end user of imported beef. Monthly ending beef
stocks will remain fairly tight in 2005, along with high market prices.

Australia and New Zealand will remain as the primary suppliers of
imported beef in 2005. Total imports are projected at 611,000 MT
(585,000 MT for chilled and frozen beef and 26,000 MT for prepared and
processed products), slightly higher than 2004 levels, but nearly 30%
lower than 2003, prior to the ban on U.S. beef. In the absence of U.S.
beef, demand for Australian short grain fed chilled beef will remain
strong, although limited supplies will keep market prices high.
According to trade sources, there are no other viable suppliers other
than Australia (90%) and New Zealand (10%).

Domestic beef production in 2005 is expected to rise by 1% to 505,000
MT, reflecting increased numbers of Wagyu steers and heifers coming to
slaughter age (28 -- 32 months). The dairy beef (F1 cross breed
steer/heifer and Holstein steer and cow) slaughter (20 -- 24 months) is
projected at about the same level as 2004.

### Japan's Beef Safeguard a Concern in 2005 

Beef safeguard trigger levels for the first quarter of Japan's Fiscal
Year (JFY) 2005 (April -- June) are calculated at only 61,468 MT (PWE)
for chilled beef and 64,859 MT (PWE) for frozen beef. These low trigger
levels reflect the drop in imports during the first quarter of JFY 2004
(April 2004 -- June 2004) due to the ban on U.S. beef. Trigger levels
are calculated separately for chilled and frozen beef on a quarterly
basis, calculated as 117% of the respective import levels during the
previous year, and are cumulative for successive quarters (see Table 1).
If imports return to "normal" levels in 2005, the safeguard will
trigger, increasing the import tariff to 50% from 38.5%. Japan imposed
the safeguard in 2003 when imports of chilled beef exceeded the trigger
level, causing the tariff to increase to 50% from August 1, 2003 to
March 31, 2004 (JFY 2003). Despite protests from Japan's food service
and meat industries, as well as major exporters, Japan invoked the
safeguard when it triggered.

## Table 1. Japanese Beef Safeguard Monitor 

  ----------------- ------------- ------------ ----------- ---------- -----------
  **JFY 2004                                                          
  Trigger Levels                                                      
  and Actual                                                          
  Imports**                                                           

  ** Unit: Metric                                                     
  Ton **                                                              

  **Chilled Beef**  **Trigger     **Cum.       **April**   **May**    **June**
                    Level**       Total**                             

                    Quarterly     **Actual                            
                    Cum.          Entry**                             

  I (Apr. - Jun.)   **85,115**    **52,537**   19,420      13,705     19,412

                    ** **         ** **        July        August     September

  I - II (Apr. -    **167,279**   **52,537**   0           0          0
  Sept.)                                                              

                    ** **         ** **        October     November   December

  II - III (Apr. -  **239,405**   **52,537**   0           0          0
  Dec.)                                                               

                    ** **         ** **        January     February   March

  III - IV (Apr. -  **286,156**   **52,537**   0           0          0
  Mar.)                                                               

                    ** **         ** **                                

  **Frozen Beef**   **Trigger     **Cum.       **April**   **May**    **June**
                    Level**       Total**                             

                    **Quarterly   **Actual                            
                    Cum.**        Entry**                             

  I (Apr. - Jun.)   **71,254**    **55,435**   22,743      14,788     17,904

                    ** **         ** **        July        August     September

  I - II (Apr. -    **162,958**   **0**        0           0          0
  Sept.)                                                              

                    ** **         ** **        October     November   December

  II - III (Apr. -  **262,823**   **0**        0           0          0
  Dec.)                                                               

                    ** **         ** **        January     February   March

  III - IV (Apr. -  **321,812**   **0**        0           0          0
  Mar.)                                                               

  Source: Ministry                                                    
  of Finance (ALIC                                                    
  Monthly)                                                            
  ----------------- ------------- ------------ ----------- ---------- -----------

## 2004 Situation Update and Outlook Summary

Due to Japan's ban on U.S. beef, total beef consumption (beef and
prepared and processed products) is projected to plunge by 17% to 1.126
million MT in 2004. The lack of imported U.S. beef particularly hurt
Japan's beef bowl and barbecue restaurants due to their heavy dependence
on specific U.S. cuts, such as short plate and no boneless short rib.
Given the lack of alternative supplies, many of these restaurants
substituted pork, seafood, lamb and poultry meat, for beef. Household
beef consumption in Japan fell in 2004 as consumers switched to pork.
(see Table 2).

Prior to Japan's import ban, U.S. beef (mostly grain fed) represented
about one-third of Japan's total annual beef consumption, and nearly
half of Japan's total beef imports. Due to the ban on U.S. beef, imposed
in December 2003, Australia's import share jumped to 90%, while New
Zealand captured the remainder. Total imports from Australia and New
Zealand are expected to rise by 29% in 2004 to 604,000 \[578,000 MT for
chilled and frozen beef combined and 26,000 MT for prepared and
processed products\] (see Tables 4 and 5). Despite the increases, total
imports are expected to be about 30% lower from 2003 levels.

Stocks are expected to remain tight through 2004, with the year ending
level projected 20% lower at 88,000 MT (see Table 3). Small quantities
of U.S. beef were available during the first half of 2004 at relatively
high prices, but have been depleted during the summer. Prices for
Australian beef, which was used to bridge the supply deficit,
particularly in the food service and retails sectors, remained high
during the year. The average price for full set/short grain fed
(chilled) rose by 30% to 891 yen per kilogram during the first half of
the year, while prices for full set/grass fed (chilled) rose by 20% to
748 yen per kilogram. However, Australian supplies of specific cuts
(frozen and chilled), which are normally supplied by the U.S., such as
short plate and bone-less short rib, were inadequate to meet demand.
Prior to the ban, Japanese beef bowl (*gyudon*) and barbeque
(*yakiniku*) restaurants were heavily dependant on specific cuts from
the U.S. Prices for Australian grass fed trimmings (frozen), which are
used in ground beef, rose by 22% to 423 yen per kilogram, reflecting
strong demand in Japan's food service and retail sectors.

Domestic beef production is expected to increase slightly to 500,000 MT
in 2004, reflecting higher slaughter numbers for Wagyu and dairy breed
beef cattle. Market sources report that fattening operators have been
finishing cattle several months earlier than normal to take advantage of
strong demand and higher prices. Prices for lower grade carcasses (beef
and dairy breeds) rose 10-60% during the fist half of the year.

## Table 2. Japanese Monthly Household Consumption of Beef, Pork And Chicken

  ------------ ---------- ---------- ---------- ---------- ---------- ----------
  Unit. Grams                                                         
  per                                                                 
  Household                                                           

               Beef       \% Chg.    Pork       \% Chg.    Chicken    \% Chg.

  2003                                                                 

  July         650        2%         1,353      -1%        895        1%

  Aug.         755        12%        1,346      -4%        881        1%

  Sept.        614        -3%        1,327      -4%        877        -9%

  Oct.         650        5%         1,386      -6%        1,000      -3%

  Nov.         628        -6%        1,401      -4%        1,040      -2%

  Dec          789        -7%        1,486      -1%        1,299      0%

  2004                                                                 

  Jan.         525        -14%       1,389      6%         850        -7%

  Feb.         520        -17%       1,447      11%        794        -14%

  Mar.         611        -10%       1,511      9%         776        -19%

  Apr.         573        -15%       1,427      3%         862        -10%

  May          618        -14%       1,458      5%         939        -4%

  Jun.         587        -18%       1,463      8%         884        -2%

  Source:                                                             
  Daily Meat                                                          
  and                                                                 
  Livestock,                                                          
  Aug. 9 Issue                                                        
  ------------ ---------- ---------- ---------- ---------- ---------- ----------

## Table 3. Japanese Monthly Ending Beef Stock Estimates

  -------------- ------------------------ ------------------------ --------------------- ------------------------ ---------------------
   Unit: Metric                                                                                                   
  Ton (Carcass                                                                                                    
  Equivalent)                                                                                                     

  ** **                                                                                                           

  ** **          **[2002]{.underline}**   **[2003]{.underline}**   **[%                  **[2004]{.underline}**   **[%
                                                                   Chg.]{.underline}**                            Chg.]{.underline}**

  Jan.           193,831                  133,924                  -31%                  92,816                   -31%

  Feb.           192,626                  133,984                  -30%                  99,883                   -25%

  Mar.           188,636                  138,349                  -27%                  95,441                   -31%

  Apr.           177,647                  126,871                  -29%                  88,716                   -30%

  May            172,891                  122,140                  -29%                  84,867                   -31%

  Jun.           171,276                  115,050                  -33%                  83,976                   -27%

  Jul.           161,564                  125,347                  -22%                  0                        -100%

  Aug.           158,119                  114,453                  -28%                  0                        -100%

  Sept.          160,770                  113,511                  -29%                  0                        -100%

  Oct.           146,539                  117,189                  -20%                  0                        -100%

  Nov.           144,354                  119,547                  -17%                  0                        -100%

  Dec.           128,636                  109,487                  -15%                  0                        -100%

  Source: ALIC                                                                                                    
  Monthly                                                                                                         
  Statistics                                                                                                      
  -------------- ------------------------ ------------------------ --------------------- ------------------------ ---------------------

## Table 4. Japanese Beef Imports for January - June 2004

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

  **Product                                                                 
  Group**                                                                   

  **BEEF (HS                                                                
  0201,                                                                     
  0202) **                                                                  

  **Quantity:                                                               
  Metric Ton**                                                              

                                                                            **%
                                                                            Change**

  **Rank**      **Country**       **2002**      **2003**      **2004**      **04/03**

  ** **         ** **             **Jan. -      **Jan. -      **Jan. -      ** **
                                  Jun.**        Jun.**        Jun.**        

  **0**         **\--World\--**   **211,873**   **280,477**   **198,348**   **-29%**

  1             Australia         93,210        136,070       179,685       32%

  2             New Zealand       5,446         8,596         16,696        94%

  3             United States     104,039       128,059       1,276         -99%

  4             Chile             \-            \-            247           n.a.

  5             Mexico            6             0             228           105244%

  6             Vanuatu           156           288           204           -29%

  7             Nicaragua         \-            \-            13            n.a.

  8             Canada            9,010         7,463         \-            -100%

  9             Costa Rica        0             \-            \-            n.a.

  10            Panama            \-            \-            \-            n.a.

  11            Other             5             \-            \-            n.a.

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

  ------------- ----------------- ------------ ------------- ------------ -----------
  **Chilled                                                               
  Beef (HS                                                                
  0201)**                                                                 

  **Quantity:                                                             
  Metric Ton**                                                            

                                                                          **%
                                                                          Change**

  **Rank**      **Country**       **2002**     **2003**      **2004**     **04/03**

  ** **         ** **             **Jan. -     **Jan. -      **Jan. -     ** **
                                  Jun.**       Jun.**        Jun.**       

  **0**         **\--World\--**   **99,071**   **138,281**   **92,495**   **-33%**

  1             Australia         58,749       75,795        90,627       20%

  2             New Zealand       1,309        1,401         1,794        28%

  3             Mexico            0            0             74           n.a.

  4             Canada            1,528        2,264         0            -100%

  5             United States     37,481       58,821        0            -100%

  6             Costa Rica        0            0             0            n.a.

  7             Panama            0            0             0            n.a.

  8             Anguilla          0            0             0            n.a.

  9             Uruguay           0            0             0            n.a.

  10            Argentina         0            0             0            n.a.

  11            Others            5            0             0            n.a.

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

  ------------- ----------------- ------------- ------------- ------------- -----------
  **Frozen Beef                                                             
  (HS 0202)**                                                               

  **Quantity:                                                               
  Metric Ton**                                                              

  **% Change**                                                              

  **Rank**      **Country**       **2002**      **2003**      **2003**      **04/03**

  **0**         **\--World\--**   **112,801**   **142,196**   **105,853**   **-26%**

  1             Australia         34,461        60,275        89,058        48%

  2             New Zealand       4,137         7,195         14,902        107%

  3             United States     66,558        69,239        1,276         -98%

  4             Chile             0             0             247           n.a.

  5             Vanuatu           156           288           204           -29%

  6             Mexico            6             0             154           71213%

  7             Nicaragua         0             0             13            n.a.

  8             Costa Rica        0             0             0             n.a.

  9             Panama            0             0             0             n.a.

  10            Netherlands       0             0             0             n.a.
                Antilles                                                    

  11            Others            0             0             0             n.a.

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

## Table 5. Japanese Imports of Prepared and Processed Beef Products

+-----------+-----------+-----------+-----------+-----------+-----------+
| #######   |           |           |           |           |           |
| Prepared  |           |           |           |           |           |
| and Proce |           |           |           |           |           |
| ssed Beef |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **(HS     |           |           |           |           |           |
| 0210.20   |           |           |           |           |           |
| and HS    |           |           |           |           |           |
| 1         |           |           |           |           |           |
| 602.50)** |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **        |           |           |           |           |           |
| Quantity: |           |           |           |           |           |
| Metric    |           |           |           |           |           |
| Ton**     |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| Period:   |           |           |           |           |           |
| January - |           |           |           |           |           |
| June      |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| \% Change |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **Rank**  | **        | **2002**  | **2003**  | **2004**  | **04/03** |
|           | Country** |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
|           |           | **Jan. -  | **Jan. -  | **Jan. -  |           |
|           |           | Jun.**    | Jun.**    | Jun.**    |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **0**     | **\--W    | **4,523** | **5,464** | **5,199** | **-5%**   |
|           | orld\--** |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 1         | Australia | 872       | 1,639     | 3,289     | 101%      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 2         | China     | 224       | 312       | 703       | 125%      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 3         | New       | 517       | 582       | 613       | 5%        |
|           | Zealand   |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 4         | Brazil    | 335       | 303       | 519       | 71%       |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 5         | Argentina | 37        | 9         | 27        | 207%      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 6         | Thailand  | 58        | 53        | 27        | -49%      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 7         | Nicaragua | 0         | 10        | 13        | 37%       |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 8         | Ph        | 4         | 8         | 4         | -51%      |
|           | ilippines |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 9         | Chile     | 0         | 0         | 2         | n.a.      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 10        | France    | 0         | 0         | 1         | n.a.      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 11        | Others    | 2,477     | 2,549     | 0         | -100%     |
+-----------+-----------+-----------+-----------+-----------+-----------+
| Source of |           |           |           |           |           |
| Data:     |           |           |           |           |           |
| Japan     |           |           |           |           |           |
| Customs   |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+

+-----------+-----------+-----------+-----------+-----------+-----------+
| #######   |           |           |           |           |           |
| Prepared  |           |           |           |           |           |
| and Proce |           |           |           |           |           |
| ssed Beef |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **(HS     |           |           |           |           |           |
| 0210.20   |           |           |           |           |           |
| and HS    |           |           |           |           |           |
| 1         |           |           |           |           |           |
| 602.50)** |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **        |           |           |           |           |           |
| Quantity: |           |           |           |           |           |
| Metric    |           |           |           |           |           |
| Ton**     |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **Period: |           |           |           |           |           |
| January - |           |           |           |           |           |
| D         |           |           |           |           |           |
| ecember** |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **%       |           |           |           |           |           |
| Change**  |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **Rank**  | **        | **2001**  | **2002**  | **2003**  | **03/02** |
|           | Country** |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
|           |           | **Jan. -  | **Jan. -  | **Jan. -  |           |
|           |           | Dec.**    | Dec.**    | Dec.**    |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| **0**     | **\--W    | *         | **8,939** | *         | **68%**   |
|           | orld\--** | *20,814** |           | *15,032** |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 1         | United    | 13,667    | 4,155     | 6,929     | 67%       |
|           | States    |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 2         | Australia | 2,320     | 1,994     | 5,426     | 172%      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 3         | New       | 1,457     | 1,235     | 980       | -21%      |
|           | Zealand   |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 4         | Brazil    | 910       | 690       | 773       | 12%       |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 5         | China     | 1,016     | 656       | 705       | 8%        |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 6         | Thailand  | 168       | 102       | 107       | 5%        |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 7         | Argentina | 126       | 57        | 45        | -20%      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 8         | Nicaragua | 0         | 0         | 24        | n.a.      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 9         | Ph        | 0         | 4         | 16        | 313%      |
|           | ilippines |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 10        | Pakistan  | 13        | 2         | 14        | 530%      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| 11        | Others    | 1,138     | 45        | 11        | -75%      |
+-----------+-----------+-----------+-----------+-----------+-----------+
| Source of |           |           |           |           |           |
| Data:     |           |           |           |           |           |
| Japan     |           |           |           |           |           |
| Customs   |           |           |           |           |           |
+-----------+-----------+-----------+-----------+-----------+-----------+

# Pork Section

## 2005 Market Outlook

### Solid Consumption Expected to Reduce Stocks

The continued absence of U.S. beef in Japan is expected to maintain
strong demand and high levels of pork imports in 2005. Total imports are
projected at 1.196 million MT (1.143 million MT for chilled and frozen
pork and 53,000 MT for prepared and processed products), down 2% from
2004, but still higher than 2003 levels. Unusually high carry over
stocks of frozen pork from the previous year will likely pressure prices
for imported pork. High year-beginning stocks will likely shrink
throughout the year due to strong demand.

Stable demand for frozen pork from Denmark and other EU countries for
use in Japan's ham and bacon industry is expected to continue in 2005.
However, demand generated by Japan's ban on U.S. beef coupled with bans
on broiler meat from Thailand and China, is expected to soften in 2005
due to high pork stocks.

Imports from the United States (mainly chilled pork) are expected to
remain strong in 2005, with the U.S. import share at around 30%. Solid
retail and specialty food service demand (*Tonkatsu* or fried pork
cutlet) for high quality chilled pork will support U.S. imports in 2005.
Stable demand for seasoned ground pork will likely keep the U.S. share
for prepared and processed pork sector at about 60%.

Domestic pork production is projected slightly lower at 1.265 million
MT, due largely to smaller sow numbers. In addition, production will be
pressured by high imports, domestic environmental constraints, concerns
about hog cholera, and uncertain prospects for beef and chicken.
However, solid demand for fresh/chilled pork, particularly in the retail
sector, will likely sustain higher than normal wholesale prices for
domestic pork, boosting profits for Japanese pork producers.

### Pork Safeguard Unlikely in 2005

Japan's pork safeguard has been triggered in each of the past four
years, subjecting imports to a higher gate price (see Table 6). However,
in 2005, the possibility of the safeguard appears to be remote due to an
unusually high first quarter trigger level for the 2005 Japan Fiscal
Year (April 2005 -- March 2006), which is provisionally calculated at
307,301 MT (PWE). This represents the average level of imports during
the first quarter (April-June) for the three previous years (2002, 2003,
2004), which is 258,236 MT (PWE) multiplied by 119%. Japan's pork
safeguard covers both chilled and frozen pork.

Japan maintains its complex pork differential duty system (a minimum
import price system) and the pork safeguard as a part of Uruguay Round
agreement. Industry sources say the regular imposition of the safeguard
indicates that Japan's pork import system (differential duty and
safeguard) creates instability and fosters speculative buying, running
counter to the original intention of the system to stabilize pork
imports and to maintain an orderly market. Japan's meat industry has
been urging the government to change the system, but has yet to call for
the elimination of the safeguard. Industry sources anticipate that
Japan's pork import regime will be part of WTO agriculture negotiations.

## Table 6. Japanese Pork Safeguard Monitor for the Past Three Years

  ------------------ ------------- ------------- ----------- ---------- -----------
  **JFY 2002 Trigger                                                    
  Levels and Actual                                                     
  Imports**                                                             

   Unit: Metric Ton                                                     

  ** **              **Trigger     **Cum.        **April**   **May**    **June**
                     Level**       Total**                              

                     **Quarterly   **Actual                             
                     Cum.**        Entry**                              

  I (Apr. - Jun.)    **207,038**   **218,151**   94,683      71,682     51,786

                     ** **         ** **         July        August     September

  I - II (Apr. -     **393,487**   **422,218**   114,171     40,853     49,043
  Sept.)                                                                

                     ** **         ** **         October     November   December

  II -- III (Apr. -  **590,281**   **606,336**   58,712      65,320     60,086
  Dec.)                                                                 

                     ** **         ** **         January     February   March

  III - IV (Apr. -   **801,163**   **751,912**   63,715      48,456     33,405
  Mar.)                                                                 

                                                                        

  **JFY 2003 Trigger                                                    
  Levels and Actual                                                     
  Imports**                                                             

   Unit: Metric Ton                                                     

  ** **              **Trigger     **Cum.        **April**   **May**    **June**
                     Level**       Total**                              

                     **Quarterly   **Actual                              
                     Cum.**        Entry**                              

  I (Apr. - Jun.)    **220,706**   **239,803**   102,883     77,341     59,579

                     ** **         ** **         July        August     September

  I - II (Apr. -     **429,414**   **446,091**   120,591     38,176     47,521
  Sept.)                                                                

                     ** **         ** **         October     November   December

  II -- III (Apr. -  **641,268**   **610,832**   58,793      50,865     55,083
  Dec.)                                                                 

                     ** **         ** **         January     February   March

  III - IV (Apr. -   **839,279**   **783,238**   61,203      62,571     48,632
  Mar.)                                                                 

                                                                        

  **JFY 2004 Trigger                                                    
  Levels and Actual                                                     
  Imports**                                                             

   Unit: Metric Ton                                                     

  ** **              **Trigger     **Cum.        **April**   **May**    **June**
                     Level**       Total**                              

                     **Quarterly   **Actual                              
                     Cum.**        Entry**                              

  I (Apr. - Jun.)    **257,004**   **316,755**   133,511     89,735     93,509

                     ** **         ** **         July        August     September

  I -- II (Apr. -    **483,275**   **0**         0           0          0
  Sept.)                                                                

                     ** **         ** **         October     November   December

  II - III (Apr. -   **694,603**   **0**         0           0          0
  Dec.)                                                                 

                     ** **         ** **         January     February   March

  III - IV (Apr. -   **890,399**   **0**         0           0          0
  Mar.)                                                                 

  Source: Ministry                                                      
  of Finance and                                                        
  ALIC Monthly                                                          
  ------------------ ------------- ------------- ----------- ---------- -----------

### Pork TRQ Under FTA with Mexico Expected to Begin in 2005

The possible implementation of a Free Trade Agreement between Japan and
Mexico in 2005 will lead to the establishment of a pork TRQ for Mexico.
Japan agreed to start the TRQ at 38,000 MT (PWE), and incrementally
increase it to 80,000 MT over five years. The agreement would also cut
the tariff to 2.2% from 4.3% for Mexican pork imported at or above the
gate price (minimum import price), while all other aspects of the pork
differential duty system would remain unchanged. Japan has not yet
discussed how the TRQ will impact the pork safeguard. Japan and Mexico
are expected to sign the FTA in September 2004, and will reportedly
implement the agreement in April 2005.

## 2004 Situation Update and Outlook Summary

Pork consumption in 2004 is projected to rise by 5 % to 2.494 million
MT, reflecting strong alternative demand for U.S. beef and Thai and
Chinese broiler meat, which are currently under import restrictions due
to BSE and Avian Influenza (see JA4069 Poultry Annual). Many of Japan's
restaurants, particularly beef bowl and barbecue chains, along with
producers of Japanese lunch boxes (*bento*), developed alternative
dishes utilizing pork in the absence of U.S. beef and broiler meat.

Total imports are forecast to rise by 8% to 1.226 million MT, 1.172
million MT for chilled and frozen pork and 54,000 MT for prepared and
processed products (see Tables 9 and 10). Imports from the United States
are also expected to rise in 2004, maintaining the U.S. import share at
around 30%. Imports of U.S. chilled pork are expected to increase 5-7%,
bolstered by strong retail and food service demand. Denmark, other EU
countries, and Canada are expected to increase frozen pork exports to
Japan in 2004. Trade sources report that EU frozen pork from a EU
storage program has become more attractive in Japan in light of strong
demand.

According to industry data, imports of chilled and frozen pork for
January -- July 2004 were up 17% at 844,000 MT (590,800 MT PWE). As
noted above, high April -- June entries (first quarter JFY 2004) caused
the safeguard to trigger starting on August 1, 2004. July entries were
also relatively high at 148,510 MT (103,000 MT PWE) as the industry
rushed to procure supplies before the safeguard started, resulting in a
build-up of frozen stocks. June ending stocks are estimated at 315,400
MT (see Table 8), which will likely keep monthly imports after August
2004 relatively low. Year ending stocks are projected at 213,000 MT, a
slight increase over the previous year.

Japan's pork production is expected to increase slightly by 1% in 2004
to 1.27 million MT. Despite small sow numbers at the beginning of the
year, slaughter numbers rose due to rushed finishing to take advantage
of strong retail demand and high prices for fresh/chilled pork in the
absence of U.S. beef (see Table 7).

## Table 7. Japanese Wholesale Price of Domestic Pork Carcass in Tokyo Market

  -------------------------- --------------------- --------------------- --------------------- --------------------- ---------------------
  **Quarterly and Annual                                                                                             
  Averages 2001 -- 2004**                                                                                            

  Unit: Yen per Kilo                                                                                                 

  **Category by Meat Grade**                                                                                         

  **[Excellent                                                                                                       
  Grade]{.underline}**                                                                                               

  [Year/Month]{.underline}   **[1st                **[2^nd^              **[3rd                **[4th                **[Yearly
                             Qtr.]{.underline}**   Qtr.]{.underline}**   Qtr.]{.underline}**   Qtr.]{.underline}**   Ave.]{.underline}**

  2001                       434                   484                   506                   506                   **482**

  2002                       498                   559                   510                   396                   **491**

  \% chg                     15%                   16%                   1%                    -22%                  **2%**

  2003                       413                   460                   426                   397                   **424**

  \% chg                     -17%                  -18%                  -16%                  0%                    **-14%**

  2004                       498                   487                   0                     0                     **n.a.**

  \% chg                     21%                   6%                    -58%                  -100%                 **-31%**

                                                                                                                     ** **

  **[Medium                                                                                                          
  Grade]{.underline}**                                                                                               

  [Year/Month]{.underline}   **[1st                **[2^nd^              **[3rd                **[4th                **[Yearly
                             Qtr.]{.underline}**   Qtr.]{.underline}**   Qtr.]{.underline}**   Qtr.]{.underline}**   Ave.]{.underline}**

  2001                       395                   448                   469                   476                   **447**

  2002                       459                   525                   469                   355                   **452**

  \% chg                     16%                   17%                   0%                    -25%                  **1%**

  2003                       362                   408                   359                   332                   **365**

  \% chg                     -21%                  -22%                  -23%                  -7%                   **-19%**

  2004                       438                   427                   0                     0                     **n.a.**

  \% chg                     21%                   5%                    -100%                 -100%                 **-30%**

  Source: ALIC Monthly                                                                                               
  Statistics (Compiled by                                                                                            
  Ag. Office, Ag. Office                                                                                             
  Tokyo)                                                                                                             
  -------------------------- --------------------- --------------------- --------------------- --------------------- ---------------------

## Table 8. Japanese Monthly Ending Pork Stock Estimates

  ---------------- ----------- ----------- ----------- ----------- -----------
   Unit: Metric                                                    
  Ton (Carcass                                                     
  Equivalent)                                                      

  **Month/Year**   **2002**    **2003**    **% Chg.**  **2004**    **% Chg.**

  Jan.             187,276     210,374     12%         212,876     1%

  Feb.             196,929     209,909     7%          209,590     -0%

  Mar.             205,100     202,273     -1%         215,531     7%

  Apr.             220,861     239,071     8%          259,394     9%

  May              226,903     257,789     14%         295,539     15%

  Jun.             216,370     252,813     17%         315,399     25%

  Jul.             251,339     303,764     21%         0           -100%

  Aug.             225,249     272,654     21%         0           -100%

  Sept.            209,839     253,967     21%         0           -100%

  Oct.             196,200     233,366     19%         0           -100%

  Nov.             197,524     221,971     12%         0           -100%

  Dec.             190,570     210,947     11%         0           -100%

  Source: ALIC                                                     
  Monthly                                                          
  Statistics                                                       
  ---------------- ----------- ----------- ----------- ----------- -----------

## Table 9. Japanese Pork Imports for January -- June 2004

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

  **Product                                                                 
  Group**                                                                   

  **PORK (HS                                                                
  0203)**                                                                   

  **Quantity:                                                               
  Metric Ton**                                                              

  **% Change**                                                              

  **Rank**      **Country**       **2002**      **2003**      **2004**      **04/03**

  ** **         ** **             **Jan. -      **Jan. --     **Jan. -      ** **
                                  Jun.**        Jun.**        Jun.**        

  **0**         **\--World\--**   **391,699**   **383,610**   **486,936**   **27%**

  1             Denmark           115,648       103,346       154,790       50%

  2             United States     132,983       133,724       142,589       7%

  3             Canada            91,308        88,244        104,307       18%

  4             Chile             8,074         12,033        20,555        71%

  5             Mexico            19,806        17,381        17,617        1%

  6             Hungary           9,385         7,598         10,695        41%

  7             France            0             1,277         7,372         477%

  8             Netherlands       0             4,967         6,827         37%

  9             Austria           2,135         1,439         5,072         252%

  10            Australia         5,388         6,267         4,529         -28%

  11            Others            6,972         7,334         12,583        72%

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

  ------------- ----------------- ------------- ------------ ------------ -----------
  Chilled Pork                                                            
  (HS 0203.11,                                                            
  0203.12 &                                                               
  0203.19)                                                                

  **Quantity:                                                             
  Metric Ton**                                                            

  **% Change**                                                            

  **Rank**      **Country**       **2002**      **2003**     **2004**     **04/03**

  ** **         ** **             **Jan. -      **Jan. --    **Jan. -     ** **
                                  Jun.**        Jun.**       Jun.**       

  **0**         **\--World\--**   **100,879**   **87,383**   **97,225**   **11%**

  1             United States     67,871        59,408       68,791       16%

  2             Canada            21,889        18,545       19,668       6%

  3             Mexico            6,416         4,382        5,008        14%

  4             Australia         4,559         4,899        3,498        -29%

  5             Denmark           140           129          185          43%

  6             Korea, South      0             0            30           n.a.

  7             Spain             0             6            22           287%

  8             Italy             4             0            21           6446%

  9             France            0             0            3            n.a.

  10            Belgium           0             0            0            n.a.

  11            Others            0             14           0            -100%

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

  ------------- ----------------- ------------- ------------- ------------- -----------
  **Frozen Pork                                                             
  (HS 0203.21,                                                              
  0203.22 &                                                                 
  0203.29)**                                                                

  **Quantity:                                                               
  Metric Ton**                                                              

                                                                            **%
                                                                            Change**

  **Rank**      **Country**       **2002**      **2003**      **2004**      **04/03**

  ** **         ** **             **Jan. -      **Jan. -      **Jan. -      ** **
                                  Jun.**        Jun.**        Jun.**        

  **0**         **\--World\--**   **290,820**   **296,226**   **389,711**   **32%**

  1             Denmark           115,508       103,217       154,605       50%

  2             Canada            69,419        69,699        84,639        21%

  3             United States     65,113        74,316        73,799        -1%

  4             Chile             8,074         12,033        20,555        71%

  5             Mexico            13,390        12,999        12,609        -3%

  6             Hungary           9,385         7,598         10,695        41%

  7             France            0             1,277         7,370         477%

  8             Netherlands       0             4,967         6,827         37%

  9             Austria           2,135         1,439         5,072         252%

  10            Ireland           0             3,301         4,401         33%

  11            Others            7,796         5,380         9,140         70%

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

## Table 10. Japanese Imports of Prepared and Processed Pork 

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

  **Prepared                                                             
  and Processed                                                          
  Pork**                                                                 

  **(HS                                                                  
  0210.11, HS                                                            
  0210.12, HS                                                            
  0210.19, HS                                                            
  1602.41, & HS                                                          
  1602.42)**                                                             

  **Quantity:                                                            
  Metric Ton**                                                           

  **Period:                                                              
  January -                                                              
  June**                                                                 

  **% Change**                                                           

  **Rank**      **Country**       **2002**     **2003**     **2004**     **04/03**

                                  **Jan. -     **Jan. -     **Jan. -     
                                  Jun.**       Jun.**       Jun.**       

  **0**         **\--World\--**   **16,064**   **21,009**   **20,401**   **-3%**

  1             United States     10,622       13,455       11,910       -11%

  2             China             1,395        1,902        3,603        89%

  3             Canada            2,950        4,030        3,196        -21%

  4             Denmark           75           684          476          -30%

  5             Italy             370          393          426          8%

  6             Australia         334          410          409          0%

  7             Thailand          76           77           133          74%

  8             Mexico            92           0            109          n.a.

  9             Taiwan            128          53           72           36%

  10            Spain             0            0            54           n.a.

  11            Others            22           5            12           n.a.

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

  ------------- ----------------- ------------ ------------ ------------ -----------
  **Prepared                                                             
  and Processed                                                          
  Pork**                                                                 

  **(HS                                                                  
  0210.11, HS                                                            
  0210.12, HS                                                            
  0210.19, HS                                                            
  1602.41, & HS                                                          
  1602.42)**                                                             

  **Quantity:                                                            
  Metric Ton**                                                           

  **Period:                                                              
  January -                                                              
  December**                                                             

  **% Change**                                                           

  **Rank**      **Country**       **2001**     **2002**     **2003**     **04/03**

                                  **Jan. -     **Jan. -     **Jan. -     
                                  Dec.**       Dec.**       Dec.**       

  **0**         **\--World\--**   **38,234**   **35,008**   **39,597**   **13%**

  1             United States     22,006       22,101       24,329       10%

  2             Canada            10,314       7,142        7,350        3%

  3             China             2,673        3,357        4,406        31%

  4             Denmark           1,300        226          1,225        441%

  5             Italy             671          830          959          16%

  6             Australia         166          770          839          9%

  7             Taiwan            619          295          222          -25%

  8             Thailand          52           162          204          26%

  9             Germany           3            0            28           n.a.

  10            Spain             61           0            23           n.a.

  11            Others            369          125          13           -90%

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

# Cattle PS&D Table

+-----------------+------+------+------+------+------+------+--------+
| ###### Japan    |      |      |      |      |      |      |        |
|                 |      |      |      |      |      |      |        |
| Animal Numbers, |      |      |      |      |      |      |        |
| Cattle          |      |      |      |      |      |      |        |
+-----------------+------+------+------+------+------+------+--------+
|                 | **20 | **R  | **20 | **Es | **20 | **Fo | *      |
|                 | 03** | evis | 04** | tima | 05** | reca | *UOM** |
|                 |      | ed** |      | te** |      | st** |        |
+-----------------+------+------+------+------+------+------+--------+
|                 | **   | **   | **   | **   | **   | **   |        |
|                 | USDA | Post | USDA | Post | USDA | Post |        |
|                 | Offi | Esti | Offi | Esti | Offi | Esti |        |
|                 | cial | mate | cial | mate | cial | mate |        |
|                 | \    | \    | \    | \    | \    | \    |        |
|                 | [Old | [New | [Old | [New | [Old | [New |        |
|                 | \]** | \]** | \]** | \]** | \]** | \]** |        |
+-----------------+------+------+------+------+------+------+--------+
| Market Year     |      | 01/  |      | 01/  |      | 01/  | M      |
| Begin           |      | 2003 |      | 2004 |      | 2005 | M/YYYY |
+-----------------+------+------+------+------+------+------+--------+
| Total Cattle    | 4563 | 4524 | 4550 | 4478 | 4530 | 4400 | (1000  |
| Beg. Stks       |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Dairy Cows Beg. | 964  | 964  | 960  | 936  | 0    | 930  | (1000  |
| Stks            |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Beef Cows Beg.  | 643  | 643  | 640  | 624  | 0    | 620  | (1000  |
| Stocks          |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Production      | 1430 | 1438 | 1400 | 1415 | 0    | 1410 | (1000  |
| (Calf Crop)     |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Intra EC        | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
| Imports         |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Total Imports   | 23   | 23   | 24   | 20   | 0    | 20   | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| TOTAL Imports   | 23   | 23   | 24   | 20   | 0    | 20   | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| TOTAL SUPPLY    | 6016 | 5985 | 5974 | 5913 | 4530 | 5830 | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Intra EC        | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
| Exports         |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Total Exports   | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| TOTAL Exports   | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Cow Slaughter   | 545  | 541  | 540  | 550  | 0    | 555  | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Calf Slaughter  | 5    | 8    | 5    | 5    | 0    | 5    | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Other Slaughter | 655  | 657  | 640  | 670  | 0    | 675  | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Total Slaughter | 1205 | 1206 | 1185 | 1225 | 0    | 1235 | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Loss            | 261  | 301  | 259  | 288  | 0    | 295  | (1000  |
|                 |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Ending          | 4550 | 4478 | 4530 | 4400 | 0    | 4300 | (1000  |
| Inventories     |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| TOTAL           | 6016 | 5985 | 5974 | 5913 | 0    | 5830 | (1000  |
| DISTRIBUTION    |      |      |      |      |      |      | HEAD)  |
+-----------------+------+------+------+------+------+------+--------+
| Calendar Yr.    | 130  | 159  | 130  | 0    | 0    | 0    | (HEAD) |
| Imp. from U.S.  |      |      |      |      |      |      |        |
+-----------------+------+------+------+------+------+------+--------+
| Calendar Yr.    | 0    | 0    | 0    | 0    | 0    | 0    | (HEAD) |
| Exp. to U.S.    |      |      |      |      |      |      |        |
+-----------------+------+------+------+------+------+------+--------+

#  Beef PS&D Table

+---------------+------+------+------+------+------+------+---------+
| ###### Japan  |      |      |      |      |      |      |         |
|               |      |      |      |      |      |      |         |
| Meat, Beef    |      |      |      |      |      |      |         |
| and Veal      |      |      |      |      |      |      |         |
+---------------+------+------+------+------+------+------+---------+
|               | **20 | **R  | **20 | **Es | **20 | **Fo | **UOM** |
|               | 03** | evis | 04** | tima | 05** | reca |         |
|               |      | ed** |      | te** |      | st** |         |
+---------------+------+------+------+------+------+------+---------+
|               | **   | **   | **   | **   | **   | **   |         |
|               | USDA | Post | USDA | Post | USDA | Post |         |
|               | Offi | Esti | Offi | Esti | Offi | Esti |         |
|               | cial | mate | cial | mate | cial | mate |         |
|               | \    | \    | \    | \    | \    | \    |         |
|               | [Old | [New | [Old | [New | [Old | [New |         |
|               | \]** | \]** | \]** | \]** | \]** | \]** |         |
+---------------+------+------+------+------+------+------+---------+
| Market Year   |      | 01/  |      | 01/  |      | 01/  | MM/YYYY |
| Begin         |      | 2003 |      | 2004 |      | 2005 |         |
+---------------+------+------+------+------+------+------+---------+
| Slaughter     | 1205 | 1206 | 1185 | 1225 | 0    | 1235 | (1000   |
| (Reference)   |      |      |      |      |      |      | HEAD)   |
+---------------+------+------+------+------+------+------+---------+
| Beginning     | 129  | 129  | 110  | 110  | 80   | 88   | (1000   |
| Stocks        |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Production    | 495  | 495  | 500  | 500  | 0    | 505  | (1000   |
|               |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Intra EC      | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
| Imports       |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Total Imports | 810  | 850  | 520  | 604  | 0    | 611  | (1000   |
|               |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| TOTAL Imports | 810  | 850  | 520  | 604  | 0    | 611  | (1000   |
|               |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| TOTAL SUPPLY  | 1434 | 1474 | 1130 | 1214 | 80   | 1204 | (1000   |
|               |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Intra EC      | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
| Exports       |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Total Exports | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
|               |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| TOTAL Exports | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
|               |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Human Dom.    | 1324 | 1364 | 1050 | 1126 | 0    | 1116 | (1000   |
| Consumption   |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Other Use,    | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
| Losses        |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| TOTAL Dom.    | 1324 | 1364 | 1050 | 1126 | 0    | 1116 | (1000   |
| Consumption   |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Ending Stocks | 110  | 110  | 80   | 88   | 0    | 88   | (1000   |
|               |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| TOTAL         | 1434 | 1474 | 1130 | 1214 | 0    | 1204 | (1000   |
| DISTRIBUTION  |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+
| Calendar Yr.  | 379  | 394  | 0    | 1    | 0    | 0    | (1000   |
| Imp. from     |      |      |      |      |      |      | MT CWE) |
| U.S.          |      |      |      |      |      |      |         |
+---------------+------+------+------+------+------+------+---------+
| Calendar Yr.  | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
| Exp. to U.S.  |      |      |      |      |      |      | MT CWE) |
+---------------+------+------+------+------+------+------+---------+

# Swine PS&D Table

+------------------+------+------+------+------+------+------+--------+
| ###### Japan     |      |      |      |      |      |      |        |
|                  |      |      |      |      |      |      |        |
| Animal Numbers,  |      |      |      |      |      |      |        |
| Swine            |      |      |      |      |      |      |        |
+------------------+------+------+------+------+------+------+--------+
|                  | 2003 | Rev  | 2004 | Esti | 2005 | Fore | UOM    |
|                  |      | ised |      | mate |      | cast |        |
+------------------+------+------+------+------+------+------+--------+
|                  | USDA | Post | USDA | Post | USDA | Post |        |
|                  | Offi | Esti | Offi | Esti | Offi | Esti |        |
|                  | cial | mate | cial | mate | cial | mate |        |
|                  | \[O  | \[N  | \[O  | \[N  | \[O  | \[N  |        |
|                  | ld\] | ew\] | ld\] | ew\] | ld\] | ew\] |        |
+------------------+------+------+------+------+------+------+--------+
| Market Year      |      | 01/  |      | 01/  |      | 01/  | M      |
| Begin            |      | 2003 |      | 2004 |      | 2005 | M/YYYY |
+------------------+------+------+------+------+------+------+--------+
| TOTAL Beginning  | 9725 | 9725 | 9720 | 9724 | 9720 | 9500 | (1000  |
| Stocks           |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Sow Beginning    | 929  | 929  | 930  | 918  | 0    | 910  | (1000  |
| Stocks           |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Production (Pig  | 1    | 1    | 1    | 1    | 0    | 1    | (1000  |
| Crop)            | 7250 | 7250 | 7250 | 7100 |      | 7000 | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Intra EC Imports | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                  |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Total Imports    | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                  |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| TOTAL Imports    | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                  |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| TOTAL SUPPLY     | 2    | 2    | 2    | 2    | 9720 | 2    | (1000  |
|                  | 6975 | 6975 | 6970 | 6824 |      | 6500 | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Intra EC Exports | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                  |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Total Exports    | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                  |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| TOTAL Exports    | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                  |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Sow Slaughter    | 0    | 0    | 0    | 0    | 0    | 0    | (1000  |
|                  |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| OTHER SLAUGHTER  | 1    | 1    | 1    | 1    | 0    | 1    | (1000  |
|                  | 6381 | 6381 | 6500 | 6600 |      | 6350 | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Total Slaughter  | 1    | 1    | 1    | 1    | 0    | 1    | (1000  |
|                  | 6381 | 6381 | 6500 | 6600 |      | 6350 | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Loss             | 874  | 870  | 750  | 724  | 0    | 700  | (1000  |
|                  |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Ending           | 9720 | 9724 | 9720 | 9500 | 0    | 9450 | (1000  |
| Inventories      |      |      |      |      |      |      | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| TOTAL            | 2    | 2    | 2    | 2    | 0    | 2    | (1000  |
| DISTRIBUTION     | 6975 | 6975 | 6970 | 6824 |      | 6500 | HEAD)  |
+------------------+------+------+------+------+------+------+--------+
| Calendar Yr.     | 77   | 77   | 70   | 40   | 0    | 40   | (HEAD) |
| Imp. from U.S.   |      |      |      |      |      |      |        |
+------------------+------+------+------+------+------+------+--------+
| Calendar Yr.     | 0    | 0    | 0    | 0    | 0    | 0    | (HEAD) |
| Exp. to U.S.     |      |      |      |      |      |      |        |
+------------------+------+------+------+------+------+------+--------+

# Pork PS&D Table

+-----------------+------+------+------+------+------+------+---------+
| Japan           |      |      |      |      |      |      |         |
|                 |      |      |      |      |      |      |         |
| ###             |      |      |      |      |      |      |         |
| ### Meat, Swine |      |      |      |      |      |      |         |
+-----------------+------+------+------+------+------+------+---------+
|                 | **20 | **R  | **20 | **Es | **20 | **Fo | **UOM** |
|                 | 03** | evis | 04** | tima | 05** | reca |         |
|                 |      | ed** |      | te** |      | st** |         |
+-----------------+------+------+------+------+------+------+---------+
|                 | **   | **   | **   | **   | **   | **   |         |
|                 | USDA | Post | USDA | Post | USDA | Post |         |
|                 | Offi | Esti | Offi | Esti | Offi | Esti |         |
|                 | cial | mate | cial | mate | cial | mate |         |
|                 | \    | \    | \    | \    | \    | \    |         |
|                 | [Old | [New | [Old | [New | [Old | [New |         |
|                 | \]** | \]** | \]** | \]** | \]** | \]** |         |
+-----------------+------+------+------+------+------+------+---------+
| Market Year     |      | 01/  |      | 01/  |      | 01/  | MM/YYYY |
| Begin           |      | 2003 |      | 2004 |      | 2005 |         |
+-----------------+------+------+------+------+------+------+---------+
| Slaughter       | 1    | 1    | 1    | 1    | 0    | 1    | (1000   |
| (Reference)     | 6381 | 6381 | 6500 | 6600 |      | 6350 | HEAD)   |
+-----------------+------+------+------+------+------+------+---------+
| Beginning       | 191  | 191  | 211  | 211  | 191  | 213  | (1000   |
| Stocks          |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Production      | 1259 | 1259 | 1270 | 1270 | 0    | 1265 | (1000   |
|                 |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Intra EC        | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
| Imports         |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Total Imports   | 1133 | 1132 | 1300 | 1226 | 0    | 1196 | (1000   |
|                 |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| TOTAL Imports   | 1133 | 1132 | 1300 | 1226 | 0    | 1196 | (1000   |
|                 |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| TOTAL SUPPLY    | 2583 | 2582 | 2781 | 2707 | 191  | 2674 | (1000   |
|                 |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Intra EC        | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
| Exports         |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Total Exports   | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
|                 |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| TOTAL Exports   | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
|                 |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Human Dom.      | 2372 | 2371 | 2590 | 2494 | 0    | 2473 | (1000   |
| Consumption     |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Other Use,      | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
| Losses          |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| TOTAL Dom.      | 2372 | 2371 | 2590 | 2494 | 0    | 2473 | (1000   |
| Consumption     |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Ending Stocks   | 211  | 211  | 191  | 213  | 0    | 201  | (1000   |
|                 |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| TOTAL           | 2583 | 2582 | 2781 | 2707 | 0    | 2674 | (1000   |
| DISTRIBUTION    |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Calendar Yr.    | 351  | 384  | 385  | 390  | 0    | 396  | (1000   |
| Imp. from U.S.  |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+
| Calendar Yr.    | 0    | 0    | 0    | 0    | 0    | 0    | (1000   |
| Exp. to U.S.    |      |      |      |      |      |      | MT CWE) |
+-----------------+------+------+------+------+------+------+---------+

# 

#