Japan is a country where retail sales in the food and beverage market are estimated at a whooping 400 billion euros, while its low food self-sufficiency makes it a major importing destination. At the same time, high standards and high-quality expectations, along with the mindset of the people, who don’t tend to jump to opportunities or good deals but are rather interested in establishing long term cooperation with reliable partners that produce competitive or innovative products, make the Japanese market a challenging, yet very promising one. Athanasios Karapetsas, Minister Plenipotentiary for Economic and Commercial Affairs of the Greek Embassy in Tokyo gives Ambrosia Magazine a full insight of one of the biggest markets in the world.

Interview: Charitomeni Vonta

How would you describe the profile of Japanese food and beverage market?
First of all, let me say a few words about Japan. It is the third largest economy, with a high-income population of 125 million. In Japan we have several economic centers. Tokyo Metropolitan Area with a population of 36 million people (Tokyo City is 14 million) is the most important regional market in Japan. There are other important and somehow less saturated regional markets too, such as Kansai region with a population of 20 million people (Osaka, Kyoto, Kobe), Chubu region (Nagoya) with 15 million people and Kyushu with 14.5 million people (Fukuoka, Nagasaki).
Japan is one of the largest importers of agricultural products, as a result of its low food self-sufficiency. Retail sales of Japan’s food and beverage market are estimated at 400 billion euros. Food and beverage services sector is particularly important with retail sales of 250 billion euros.
It is evident that Japanese food and beverage market is one of the largest in the world but it is also a highly competitive market, with a very complex distribution system. Supermarkets account for 72% of food retail market, convenience stores increase continuously their market share which has reached 15%. The fact is that food products have to go through a network of intermediaries before they reach retail selves. Of course, Japan’s distribution system is gradually becoming simpler with less intermediaries but through a very slow process.
It should be mentioned that in recent years there is a gradual contraction of domestic demand due to population decrease and aging society. As a result, we have new trends in the market. There is growing demand for high value-added food products, such as food for specified health use, foods with Functional Claims. Also, well-known brand names have always been popular in Japan.
We should always have in mind that Japanese market is characterized by high standards and high-quality expectations.

Japanese diet is quite different from Greek food production. What are the characteristics of Japanese consumers’ preferences? Is there a demand for typical Greek products?
Certainly, there is a strong preference in traditional Japanese food but Japanese consumers like tasting recipes from other countries. Especially, young and educated people are more interested in imported products. Japanese consumers in general are looking for high quality and healthy food at reasonable prices. Packaging and appearance are also very important. Also, Japanese consumers are very health conscious and they like natural food with no food additives. Traditional Greek products like olive oil, feta cheese or wine are not included in the traditional Japanese diet but their consumption is continuously increasing.

You mentioned that Japanese consumers prefer natural food. What about organic food?
Truth be told, organic products market in Japan is less developed than expected but sales are rising. Japan has mutual recognition agreement with European Union for organic plants and organic processed foods of plant origin. For livestock products there is no EU – Japan mutual recognition agreement yet. To solve this problem, EU and Japan are currently negotiating an agreement for livestock organic products.

“Japan is not a market to look for opportunities but a market in which one should work systematically to build the right conditions for their products”

You have also mentioned wine. What are the prospects of Greek wine in Japanese market?
Wine consumption in Japan has increased considerably. The average consumption is 3 liters per person, which is still low compared to Europe. Of course, in areas such as Tokyo and in some population segments wine consumption is much higher. In Japan there is a considerable pool of wine connoisseurs and a large market for high quality wines but price is always very important (value for money). Especially, Japanese women may drink little but they actually decide what to buy and what to drink.
There has been an upward trend in Japanese wine imports for many years. The pandemic has temporarily reversed this trend but the market is already recovering. In 2022 wine imports increased by 21.4 to 1.751 million euros.
There is a strong preference for Western Europe and New World wines, while Greek wines lack country and brand awareness. In recent years we are working on this. There have been several Greek wine promotion programs (Western Greece, Naoussa and Attica regions). Already, we can see the results of our efforts. Greek exports have more than doubled in the last 2 years. From 352,8 million euros in 2020, increased to 429,6 million euros in 2021 and 815,0 million euros in 2022.
Prospects for Greek wine exports are very positive, provided we will continue our efforts, focusing more on business targets and less on generic wine education.

Could you please say a few words on the EU – Japan Economic Partnership Agreement?
The EU – Japan EPA entered into force on February 1, 2019. It is one of the most advanced trade agreements of EU. Tariffs have been lifted or will be gradually eliminated. In some case the agreement establishes TRQs (Tariff Rate Quata), which mean that there is a limit in the quantity of imports that benefit from reduced tariffs. There are 25 Agricultural Products TRQs, with the one for soft cheese (including feta) to be of particular interest for Greece. Non-tariff barriers are also being removed.

For more information please check the following sites:
EU-Japan Economic Partnership Agreement
Access to markets

What are the prospects of Greek food products in Japanese market and what is your advice to Greek Exporters?
In 2022, Greek food exports to Japan increased by 39.2%, reaching 22.9 million euros. The most important food products we export to Japan are canned peach, cereal preparations, dried nuts, olive oil, confectionery, feta cheese and honey.
Our share in the Japanese food market is almost insignificant but there are good prospects for our products. Indeed, Japan is a very big market with very low food self-sufficiency. In addition, the quality of many Greek products is excellent and they can successfully compete in the market.
The EU – Japan EPA is a very important advantage, because it is expected to benefit exports of agricultural products more than any other sector.
Of course, we face challenges too. Long distance, high transportation cost and difficulties in air cargo are the most serious problems. Small exporters and newcomers face a very serious problem because of the lack of shared container shipment service between Greece and Japan. In some cases, we face a problem with short self-life. Also, low country and brand awareness is another problem for Greek food products, as I have already mentioned for wine.
Greek exporters should know that Japan is a very promising market but, at the same time, it is a very difficult one. Indeed, the distribution system is very complicated with many intermediaries. Products before they reach the selves go through several levels of distribution channels.
In fact, Japanese companies are very conservative and they do not rush to take advantage of opportunities or good deals. They are mostly interested in establishing long term cooperation with reliable partners that produce competitive or innovative products.
Therefore, Japan is not a market to look for opportunities but a market in which one should work systematically to build the right conditions for their products. Greek companies must be prepared to visit the country and if needed again and again. Participation in the food and beverage international exhibition Foodex is a very good vehicle for promoting exports to Japan. Enterprise Greece participates regularly in this very important exhibition.
To enter Japanese market, exporters need to work on a long-term basis. The effort needed might be harder compared to most other markets but you will be rewarded by long term stable business cooperations.

Office E.C.A. Tokyo
3-16-30 Nishi-Azabu Minato-ku, Tokyo 106-0031 Japan
Tel:+81-3-34045853, +81-3-34041195
Email: ecocom-tokyo@mfa.gr