AgriTech in Japan
Stepping through the doorsof a world leader
Background
Japan embraces AgriTech solutions to face deepsocio-economical challenges, above all an ageing
population that will lead to a labor shortage of
200,000 farmers by 2040.

TOKYO

With a densely populated country with highly
fragmented parcels, 80% of the Japanese agri sector
is made of SMEs.

OSAKA

Japan

The total size of the domestic AgriTech market was
10.42 billon JPY in FY2016, a 7.2% increase overthe previous year.

FUKUOKA

Pop : 126 mio
GDP :$4.841 trillion (3rd)
Average farmer’s age : 66.5 yCultivation and production control solutions havebeen popular, but sales and operational support, aswell as precision farming are also forecast to growsignificantly in the coming years.

MARKET PRIORITIESKEY FEATURES•

An aging industry (average age of Japanese farmers:66.5 yo) with a dropping number of farmers. Less than
26% of population engaged in agriculture is under 50.

•Conversion of agricultural know-how into datato allow inexperienced workers to perform highprecision work.

•A sector where manual work is still overwhelming due
to geography and types of crops.

•Use of cloud systems to improve consumer
satisfaction and trust by providing food traceability,
live updates, and production information.

•A production leaning heavily toward rice andvegetables (almost half of total agricultural production
in 2013 based on value).

•Use of Big Data, drone, GPS and sensor technologies
to maximize crop yield and quality•

A densely populated country with highly fragmented,yet very fertile parcels: 50% of the population lives in
one of three metro areas.

•Increasing large-scale production and overcoming
workforce shortage.

••

Farmers working up to 2 hectares of land represent
80% of all producers.

Improve the work capacity of machinery to allow
for night operations, automatic operation, multipleoperations.

•High production costs.

•Robot technology to alleviate physical limitations ofaging workers.

•

Increasing exports are hindered by low-level adoptionof organic farming, low level of international process
management certification (GAP, HACCP), and chemical
MRLs requirements.

AgriTech in Japan

Market Size and Growth Potential••••

Total size of the domestic AgriTech market:10.42 billion JPY in FY2016, a 7.2% increaseover the previous year.
Growth potential: 33.339 billion JPY by FY
2023.
In more specific sub-sectors, the market of ICT
services in the agriculture sector is projected
to reach 7.32 billion JPY by 2020, a 4.5 times
growth compared to 2015.
Cloud services make up the largest IT segment,with a share of 48%. They grew by a factor of
7.5 between 2015 and 2016.

•••

Until FY2017 the market was primarily
centered on cultivation support solutions suchas production control of farm products.
After FY2018, sales and operational support
solutions are forecast to increase.
Precision farming is expected to grow fromFY 2018, due to the expansion of unmanned
operation systems. Increase from 29.9% to35.1% market share between FY 2015 and2016.

Sales revenue distributon of the domestic smart agricultural market
FY 2016, by solution
Precision farming

35.1%

Cultivation support solutions

33.3%

Operational support solutions

Total size :10.42 billion JPY

20.2%

Sales support solutions

9.6%

Agricultural robot systems

1.9%

0%

5%

10%

15%

20%

25%

30%

35%

40%

Sales revenue share
Precision farming

Sales support solution

Billions of JPY

Cultivation support solution

Agricultural robots system

35

Operational support solution

33.33929.00230
23.81425
20.17520

17.292
14.17915
1010.42012.05050Source : Yano Research201620172018

2019

2020

2021

20222023

Actors & Investors
Heavy actors of Japan tech, engineering, machinery and robotics
industries are increasingly active in AgriTech R&D.
Open innovation and acquisition of majority shares in AgriTech
companies allow those giants to position themselves in the global
agribusiness market. Large general trading companies like Sumitomo orMitsui look at AgriTech to diversify their investment.
They invest in domestic and foreign companies alike. Regional banks
support local community and projects.
Communication giant Softbank, e-commerce leader Rakuten get into
AgriTech.

Rakuten invested into Telefarm, a platform promoting
organic farmers in Japan, helping them with storage,transportation, manufacturing and hiring of workers.
https://global.rakuten.com/corp/about/

Sumitomo invested in Farmnote, a Japanese startup
manufacturing wearable technology to collect data fromcattle, has raised JPY 500 million (USD 4.6 million) in
funding in 2017.
http://www.sumitomocorp.co.jp/english/

Softbank launched the sales of an agricultural drone
in February 2018. Equipped with eight propellers,
it can carry liquid agricultural chemicals, fertilizers
and herbicides up to 10 kg and can be sprayed in a
maximum of 1 ha of farmland in 10 minutes.
https://www.softbank.jp/en/

A Japanese company focused on the development ofhyper-precise agricultural spray drones raised JPY 800
million (approximately USD 7 million).
https://www.nileworks.co.jp/

Optim Inc. is a market leader in AI, IoT and Big Data
platform, whose major shareholders are FUJI XEROX
Co. Ltd. and NTT Eastern Japan.
They launched in December 2017 a “Smart AgricultureAlliance” to create an ecosystem between actors(startups, investors, local governments, universities)
in the AgriTech field. https://en.optim.co.jp/

The Canadian-based precision agriculture provider
recently announced a new partnership with Japanesegeneral trading company Mitsui & Co, Ltd. to focus ondeveloping big data technologies.
https://www.farmersedge.ca/

A vertical farming group from the US, got a record-breaking USD 200 million investment
from Japan’s SoftBank in 2017 (https://bit.ly/2q5GrJG). Largest ever farm tech funding
round with SoftBank.
https://www.plenty.ag/sf/

Opportunities for SwissCompanies
Market Needs
IT & Cloud••••

Cloud and ICT solutions to grasp, update, share and manage forest information(resources, terrain, borders, ownerships).
Production management solutions for forestry industry (including evaluation ofquantities and qualities of wood in stockyards and adjusting shipment to matchdemand).
Shift to paperless operations: digitization of farming operations to improve efficiency
and allow for exports.
Accumulating data and creating databases to apply Big Data analysis tech.

Mapping & Sensors
••
•
•
•

Use of energy harvesting tech to provide wireless power to crop sensors.
Drone technology (ex: precision fertilizer spraying).
Sensors and camera.
Drone-based solutions to evaluate landslide risks.
Solutions to measure forest resources (aerial measurement).

Robotics & Machinery
••
•
•
•

Smart lightning systems for hydroponics plants.
Smart agricultural machinery, example: self-driven tractors relying on GPS and sensors.
Automation and robotization of farms and plant factory to cut down operating costs.
High-performance forestry machines, including tower-yarder to yard heavy wood incomplicated terrains.
Development of unmanned forwarder and harvester with automatic classification ofwood quality.

Want to Know More?
Contact us!

While this paper is intended to provide an overview of this specific market and its opportunities at the time of its edition,
each individual Swiss manufacturer and exporter should conduct their own research to get a better understanding of
the possibilities and opportunities available.
Together with experienced industry specialists, the Swiss Business Hub Japan will help Swiss and Liechtensteincompanies explore and develop their chances based upon customized and in-depth analysis. We can open doors tothe Japanese AgriTech sector and your potential partners.
Our team will help you decide on a suitable market strategy for Japan. We will prepare a service package based onyour specific requirements and business priorities.
Your Contacts :Claudio Mazzucchelli
Yumiko Kijima

Swiss Business Hub Japan

c/o Embassy of Switzerland
5-9-12 Minami Azabu, Minato-ku
106-8589 Tokyo Japan
tok.sbhjapan@eda.admin.ch
https://www.s-ge.com/en/company/swiss-business-hub-japan

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