“There is strong recognition that 20 years of not making [necessary] structural changes to their economy [gives] the present government a very strong mandate for change,” Luxton says. “Every comment you can garner from the political process is that there is determination for Japan to become part of TPP.”
But he says there is recognition that some special “transitional” arrangements may be necessary to assist the Japanese farmers over time to adapt to a more open market environment. He believes Japan’s liquid milk industry is unlikely to face any international competition.
The largest proportion of the milk produced in Japan is goes into fresh milk supply so, looking forward, liquid milk will continue to have a strong market in the country, he adds.
“At certain times of the year they are having to ship milk from Hokkaido to the main island.” The Japanese are looking at ways to enable small landholdings to merge in an attempt to improve dairy production.
Luxton, who attended the recent World Dairy Summit in Yokohama, says he held talks with government and industry officials.
Japan faces the problems of ageing dairy farmers and falling production.
Luxton says on a large proportion of Japanese land, “all of the island south of Hokkaido”, about 90% of the feed supply for their animals, which are in feedlots, is imported mainly from the US.
“While they have very sophisticated processing capability, which is advanced as anywhere in the world, as far as dairy products is concerned there is a challenge for them to get fresh milk supply.” – Peter Burke
