Printer Friendly

Japanese import executive looking to India for joint ventures on value-added products.

Times are tough in Japan. That makes it just the right time for Indian seafood exporters to get into joint ventures with Japanese firms, Hisashi Fujita, president of Higashimaru International Corp., recently told delegates attending the 17th India International Seafood Show held in Chennai.

"I am of the opinion that there are plenty of opportunities in India to make joint ventures with Japanese companies, particularly in the area of value addition," Fujita said. "India is a country to which serious attention should be paid, as it is one of the key sources of cultured shrimp. Its block frozen shell-on shrimp is important to consider in terms of future supply of value-added products."

Fujita has been involved in the import and sale of frozen shrimp from India to the Japanese market for the last 29 years. Over that period, the range of value-added products marketed in Japan has rapidly become wider, and the distribution system has changed dramatically. Market demand is still strong for value-added products produced in third countries, with raw material sourced from India. But the export of value-added products from India itself to Japan has not been growing. Meanwhile, Japan's economy is under great strain.

"The business environment of the Japanese food industry is very serious now," Pujita said. "Due to the global financial crisis last year, our country is suffering a decrease in consumption, while company bankruptcies, wage cuts and unemployment are increasing. The Japanese economy is now the worst since World War II.

"Retail prices have dropped day by day. Now we can buy a lunch box at just $2-3, which used to be sold at $5. Prices for instant noodles are now less than $1, and such cheap and simple products have kicked lots of over $2 high quality products out of the market. We can even get drunk for just $10 at a Japanese Izakaya, a place like a pub in India, serving alcohol and food items at $2.

"Three years ago, most of Japanese grocery stores and foodservice operators stopped using frozen food imported from China because of high levels of pesticide residue found in Chinese value-added products. Yet, because of severe market conditions, ninny companies are back to using Chinese products to supply $2 lunch boxes and $4 lunch dishes at restaurants. Nevertheless, Japanese consumers still show resistance to 'Made in China' products. I strongly believe that among all countries, only India can take the place of China, with your price, quality, and skill.

"The major value-added products for the Japanese market are produced in Thailand, Vietnam, Indonesia and China. These include not only sushi-grade and peeled tail-on shrimp, but also more new products such as fried shrimp (tempura), powdered shrimp, breaded fish, breaded shrimp, grilled fish, fish with sauce, and Chinese dim sum. I think that more and more sophisticated products will be provided in the near future."

Such products were previously processed in Japan, using imported raw materials. But at present, most of these items are processed abroad.

"We often see different countries supplying and processing according to the specification required by the end user," said Fujita. "Actually, sometimes we ship Indian raw materials to Vietnam, Thailand or China for processing. But as far as I know, there are very few instances, where raw materials from a third country are processed in India for re-export to Japan."

What is the reason for this? Why is that there is no re-processing in India for the Japanese market? Certainly this has nothing to do with technology, facilities or labor costs.

In Japan, IQF shrimp is mostly sold in supermarkets, in tray-packed form. Products developed by IQF factories on the west coast of India are exported to Europe, the United States and other countries, packed in multi-color printed polyester bags.

"But IQF shrimp packed in such color-printed bags are hardly ever sold in Japan," said Fujita. "This is because popular shrimp packaging in Japan needs same size and same color products in it. As we walk into Japanese supermarkets, we will find products like vegetables and fish well displayed with the same colors and same shapes--just like a piece of art!


"I think it is very difficult to sell such simple frozen seafood in Japanese supermarkets now. They seem to have more interest in selling deli dishes, which are cooked inside of the stores. Many Japanese housewives now purchase such prepared dishes, instead of cooking at home. More than half of such prepared dishes are processed in foreign countries and then imported into Japan. Japanese stores make them ready with easy work--just heat them with an oven, microwave, or deep-fry them. This system will be mainstream in the neat" future. So it is important to understand what kind of value-added products can be sold in Japanese markets.

"Even in the foodservice industry, the development and import of value-added products has been growing rapidly. Sushi shrimp especially has become very popular and recognized almost as much as headless shrimp in Japan. Value-added products are certainly more attractive for importers and exporters, from the point of view of profit. This tendency depends on technological progress in Southeast Asian countries, and also, on the influence of deflation and demand for lower priced products in Japan.

"Ideally, importing products in 10-kilogram bulk-packs and repacking them in Japan would have been the easiest way to meet Japanese standards. However, packing costs in Japan are so high that we have to arrange for cheaper processing in other countries.

"Cooked shrimp is hardly sold in Japanese supermarkets. Raw or blanched shrimp (for better color) account for most of the market. Therefore, we do not need manufacturing lines for cooked shrimp, which we often see in IQF factories on the west coast of India. The major Japanese IQF factories have no cooking lines. If blanching is required, it is done manually.

"The key issue for us is the stringent requirement of precise technology of processing, including bacteriological control. The standards of IQF factories on the west coast of India are already globally competitive. Many of them have automated lines with imported machinery. However, considering the quality of work by hand, I have to say that there is a big gap between the food cultures of India and Japan.

"With regard to breaded shrimp, until now the flour has been mostly manufactured in Japan. But lately, mills in Thailand are producing high quality flour, which is exported to other Southeast Asian countries. In India, it seems hard to get suppliers of such products as bread flour, seasonings and other materials in comparison with Southeast Asian countries."

Fujita continued: "There is a large market in Japan that many Indian packers are not aware of. This is the market for 'zero-rubbish' or 'zero-foreign matter' peeled shrimp for frozen food processing companies. This means that the peeled shrimp should be totally free from foreign matter of shrimp origin and non-shrimp origin. Processing by 'watch-to-select' in Japan used to be the most familiar method until recently, but now we can see many instances of processing in foreign countries."

In conclusion, the Higashimaru president said: "If some of you are interested in joint ventures with Japanese companies, I suggest that you to find a product category that is imported into Japan and available to process there."
COPYRIGHT 2010 E.W. Williams Publications, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2010 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Quick Frozen Foods International
Date:Apr 1, 2010
Previous Article:Aquaculture Grows from Strength to strength as source of supply.
Next Article:Naik frozen foods puts much emphasis on value-added products for valued customers.

Terms of use | Privacy policy | Copyright © 2019 Farlex, Inc. | Feedback | For webmasters