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Japan No Country for Old Farmers as 7-Eleven Takes Plow

  • Release time:2014-02-27

  • Browse:6034

  •    Convenience store chains Lawson Inc. (2651) and Seven & I Holdings Co. (3382) are so sure Japan’s aging farmers can’t meet demand for fresh vegetables that they’re investing in cropland and training young people to work the fields.


    Takeshi Niinami, who heads an agricultural reform committee advising Prime Minister Shinzo Abe and is the chief executive officer of Lawson, the nation’s second-largest operator, started 12 farming joint ventures since 2010 and plans 28 more.

    He’s expanding as Abe cuts subsidy payments to food-rice growers and creates land banks to consolidate small holdings into large tracts that can be leased by companies as older farmers put down their plows. The prime minister has also floated the idea of establishing special economic zones this year, which could test majority corporate ownership of farmland, something that’s blocked by current laws.

    “Farm output will keep falling unless we take action,” said Yayoi Sugihara, a spokesman for Lawson in Tokyo. “We want to bring on young farmers to become professional producers.”

    For Lawson, Seven & I’s 7-Eleven outlets and Itochu Corp.’s partly owned FamilyMart Co., a growing appetite for fresh fruit and vegetables means more frequent customer visits. Lawson estimates shoppers who drop in to buy perishable items visit its stores about twice as often as others and spend 20 percent more.

    Their challenge is to satisfy this demand in a country where agricultural land shrank 36 percent over the past five decades. The typical farmer in Japan today is a man in his mid 60s whose heirs have abandoned rural industry.‘

    Corporate Farms

    The number of farming corporations rose by 1,732 to 13,561 in the three years after rules were relaxed in December 2009 allowing companies to take stakes of almost 50 percent in agricultural ventures, from less than 10 percent previously, the latest government data show. At the last count in 2010, companies held stakes in 7 percent of farmland in Japan, according to the agriculture ministry.

    Seven & I started farming in 2008 by establishing a joint venture with an agricultural cooperative in Tomisato city, in Chiba prefecture east of Tokyo. That two-hectare farm has been joined by nine more, mostly producing vegetables.

    The company has more than 15,000 7-Eleven convenience stores in Japan and another 215 outlets under the Ito-Yokado supermarket brand, said Hirotake Henmi, a company spokesman. Lawson has about 11,500 convenience stores.

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