Turbulent 2001 for Japan
JAPAN – Japan’s fluid milk production for 2001 is forecast to decline to 8.3 million tonnes, according to a report by the United States Department of Agriculture’s Foreign Agricultural Service (FAS).
The 2% decline from the previous year is due to a continued reduction in the number of dairy cows in Japan, said the FAS. Amid tighter than anticipated raw milk supplies, FAS/Japan forecast the country’s annual use of fluid milk for processing to fall to 3,230 tonnes, a 6% decline on 2000. Drinking milk in 2001 is predicted to remain unchanged from the previous year at 4.97 million tonnes.
Demand for fluid milk for drinking use rose by 4% during the first half of 2001 following the Snow Brand skim milk powder poisoning incident in the summer of 2000. However, this stronger demand has waned in recent months. The FAS said that this would help ease the tight supply situation in the processing sector.
According to the report, three confirmed cases of BSE in Japan have had a minimal impact on the consumption of dairy products. Japanese dairy farmers may not be so lucky, warned the FAS, as the scares are likely to depress the prices of calves. The first case was reported in September, while the second and third cases were found in November. All three were detected in dairy cows. The disease may alter projected milk output for 2002, said the FAS.
Non fat dry milk (NFDM) in Japan remained weak during 2001. The FAS forecast this year’s NFDM utilisation for edible products to fall by 7% to 188,000 tonnes from last year’s levels. Demand for NFDM for drinking milk products and processed dairy products has remained fairly stagnant through the third quarter of 2001, and this situation is expected to continue into the fourth quarter.
In contrast to this, Japan’s butter supply and demand situation during 2001 remains very tight with diminishing monthly ending stocks resulting from strong ingredient demand for non salt added butter. An increased demand by processors has created a shortage for butter used in industrial purposes. While domestic production has fallen due to reduced supplies of fluid milk, the termination of high fat cream cheese imported from Australia since March has created a demand for domestic butter this year.
Japan’s cheese imports for 2001 are forecast to fall by 2% from last year to 200,000 tonnes. A weak yen and recessionary conditions, combined with lethargic market demand, were cited as the reasons. This has caused the Japanese food service market to become increasingly cost-sensitive, which has affected demand in the sector.
The FAS believes recovery in Japan’s cheese market during 2002 is unlikely as the same factors will prevail as in 2001.
