Sunday 24 June 2018

Dairy firms to take long view on being big in Japan

Trade mission bosses out to take first steps to putting Irish cheddar on shelves beside fish-flavoured cheese strings as a deal with the EU begins and Brexit looms, writes Louise Hogan in Tokyo

FROM square watermelons to fish-flavoured cheese strings, Japanese food culture is pushing the limits - from high-end cuisine to instant ready meals.

With 160,000 restaurants and more Michelin stars than any other country in the world, the south-east Asian country has a burgeoning middle class who are seeking out quality produce.

Grabbing a slice of the country's valuable food market is high on the agenda for the 25 companies and Irish agri-industry leaders taking part in a trade mission led by Agriculture Minister Michael Creed.

With the new economic partnership agreement signed between the EU and Japan, means a sharp decrease in many tariffs on foods immediately and over a 16-year period there are strong hopes the market offers potential.

Minister Creed pointed out 55pc of the world population will live in south-east Asia by 2015.

"If you can make it here you'll capture the rest of south-east Asia," he said, adding that the Government sees the region as extremely important in the context of Brexit.

"We tend to assume that everyone knows who we are and where we are," he said. "We need to emphasise that we are in the EU and we are staying in the EU and will be the only English-speaking gateway in."

David Deeley from Bord Bia's market research team explains that with a growing elderly population there is a strong focus on functional health foods and the Japanese are "highly conscious of a good diet".

He pointed out with long working days there is a growing emphasis on faster healthy solutions - from ice cream in a pouch to 24/7 vending machines and now ready meals that whistle ready to eat.

David Perry from Sugata, Bord Bia's research team on the ground in Japan, said dairy was now "huge" in Japan, with changing palates seeing people opting for stronger-tasting cheeses to go with a glass of wine.

While pork meat is still the prevalent meat, appetite for beef is growing, yet lamb is rarely seen on sale.

"All of the leading chefs would cite Japan as a pilgrimage that they have to make regularly to stay ahead of the game," said Mr Perry.

He pointed out the high demand for housing in Tokyo means small spaces, kitchens and storage areas, which results in daily shopping for home meals.

It is this that has caught the eye of Gareth Coleman, commercial director of Limerick-based dairy producer Glenstal Foods.

"We've been doing business for about five years in Japan and we would like to see if we can expand the amount of business we are doing here," he said.

"Pack sizes are very important - it is smaller pack sizes compared to Ireland or Europe," said Mr Coleman.

"The trade missions are very good as I don't think I would have come here on my own," he said.

"The fact that the Minister is leading the trade mission is fantastic - it opens doors at a very senior level.

"The UK is very important for us in terms of cheddar and there is a question mark hanging over that in relation to Brexit.

"Other markets are the Middle East, North America and Continental Europe," he said.

"Japan is a part of the solution but I don't think it is going to be the full solution if there is a cliff-edge Brexit," he said.

"The EU-Japan partnership agreement won't be fully effective for 16 years in terms of tariffs on our cheese but once we get started it is the first step on the journey because this market is a long-term play," said Mr Coleman.

"They take their time to get to know you and build a relationship before they make a decision to give you a contract - unlike western culture where they can be very fast in terms of decision-making."

Brian Schen, of Sugata Research in Japan, said food with functional claims is linked to the "health food craze" such as chocolate to decrease your stress or yoghurts labelled as reducing the fat around your organs.

"It's quite amazing, it is almost like a mini pharmacy when you go to the dairy section," he said.

Noel Corcoran from Cork's Carbery Group, one of the big five cheddar cheese producers and ingredients firms, said they are targeting the market for whey protein-based ingredients for drinks or functional uses in food such as muscle wastage in the elderly.

"In Japan it takes a long time to build up relationships and you are dealing with companies for a long-time and they like to see the same people," he said.

Irish Independent

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