Flower industry in major developed countries – Japan (2/2)

By | 20/05/2015

Flower industry in major developed countries – Japan (2/2)

 

1. Distribution of Flowers and Trading in Wholesale Markets

Flowers imported to Japan arrive by air when they come in small quantities, but most of them come through Shimonoseki through the sea as it is cheaper and can handle large quantities. The flowers that are directly imported by airplane to an airport sitting close to the community of consumers are delivered in refrigerated trucks to such big cities as Tokyo and Osaka, and those cut flowers that arrive in container ships to Shimonoseki etc. are gathered in Narita to be distributed to all parts of Japan except some areas in Osaka and Kyushu. The reason is that the Japanese logistics characteristically reduces costs through collection and distribution at Narita as we learned in Hub and Spoke system. By major destination, direct listing through wholesale markets takes up about 70% and direct supply to mass merchandizers accounts for about 30%. Japan has 194 wholesale flower markets in the capital and the rest, handling 450 billion yen a year. Retailing expenses take up about 60% of consumer price. Ordinarily, cut flowers are distributed in this order: importers wholesale market, intermediate wholesaler, flower processor retail store, flower shop, Home Center, supermarket consumption by business, consumer. And cut flowers produced in Korea are distributed in this order: producer agricultural cooperative, flower depot wholesale market, intermediate wholesaler retail store, flower shop, Home Center, supermarket consumption by business, consumer.

For wholesale markets, cut flowers register significant price gap with different grades, while grading standard varies with countries. In Japan, cut flowers are basically classified into Best, Excellent, and Fair by flower, stem, balance of petals, look, color, disease and insect, and cuts.  

 

2. Trends in Japanese Consumption of Flowers: More Flowers Consumed by Individual Consumers

Japan is one of those big consumers of flowers. With its total consumption amounting to nearly 5 billion dollars, Japanese cut flower market is attractive to worldwide suppliers

While total spending and average spending for individual consumers are both at high levels, flower consumption by individual consumers remains low compared to the other major industrialized countries. This is because 70% of the total consumption has come from related industries where flowers are handled in ceremonial occasions such as weddings, funerals, public gifts, and flower decorations at hotels. Moreover, in Japan, relatively high price of each single stem flower tends to suppress consumer desire to buy.

Nonetheless, the Japanese flower market has undergone audacious changes for the last decade. Demand from public organizations such as hotels, state-run events, and flower arrangement has decreased from about 40% to 30% due to an economic downslide, whereas non-commercial demand as well as both markets for individual consumers (such as gifts, casual bouquets, and home landscaping) and regions (such as home, projects, and public venues) is all growing. Spending on personal purposes per household amounts to about 130 dollars a year, and about 100 dollars is spent on landscaping. The practice of buying flowers for oneself is traditionally less known to the Japanese society, but for last several years, it has moved closer to the European lifestyle

 

Japanese occasions celebrated with flowers and used flowers

2nd Monday of January

Coming of age (rose, sweetpea, tulip)

Feb. 14

Valentine Day (red rose)

Mar. 14

White Day (red rose, spring flowers)

Mar. 10 thru 20

Graduation ceremony and higan (the seven-day period surrounding the equinoxes)

(spring flowers, stock, marigold)

Apr. 1 thru 10

Matriculation ceremony (carnation, rose, bridal wreath, cherryblossom)

2nd Sunday of May

Mother’s Day (carnation, rose)

June

June’s Bride (rose and others)

2nd Sunday of June

Father’s Day (white rose and others)

Jul. 5 thru 11

Obon (celebrating the Buddhist All Souls’ Day on mid-July on lunar calendar) (chrysanthemum, gentian, asiatic lily)

Aug. 5 thru 12

Obon (the rest of Japan excluding Tokyo and some other parts) (chrysanthemum, small-flowered chrysanthemum, dydeka)

Sep. 15

Seniors’ Day (lisianthus, potted gentia, potted cattleya)

Sep. 15 thru 22

Autumnal higan (seven-day period surround the autumnal equinox) (chrysanthemum, gentia)

October, November

Autumn wedding season (lisianthus, rose)

First 20 days of December

Year-end (poinsettia, cyclamen, potted phalaenopsis, potted cymbidium)

Last 20 days of December

Christmas and New Year (red rose, chrysanthemum, pine, spearflower)

Source: Nobuo Isomura, Current State of Japanese Floral Industry and Its Prospects

 

3. Current Flower Imports to Japan

As one of the three biggest importers of the world, Japan purchases a great deal of flowers from all around the world. Its total import increased from 17.6 billion yen in 2000 to 27 billion yen in 2007, and dwindled to 26 billion yen in 2008 before it increased again in 2010, thus exceeding 30 billion yen in Japanese flower market.

Japanese flower import

Japanese flower import

In 2013, the estimate is USD 388 million, which registers an annual average growth of 3.1%. This suggests a gradual increase of cut flower import to Japanese market. As described in “Floral Industry in Major Countries ― Japan Part 1“, however, the March 2010 earthquake that hit Japan hard has caused the Japanese flower market to shrink rapidly. Moreover, recent hot summers and frequent precipitation caused by whimsical weather led to the occurrence of diseases and insects, which continues to serve as a drag on the merchantability of flowers.

Import of Cut flowers in Japan

Import of Cut flowers in Japan

More and more cut flowers are imported from countries like Malaysia, Colombia, Taiwan, China, and Thailand that have weather conditions favorable for flower growth and offers competitive price. As of 2011, top importers include Malaysia, Colombia, Taiwan, China, Thailand, and Korea.

Japan’s per capita spending on cut flowers was 243.7 billion yen in 2008 and has registered a steady increase, while chrysanthemum takes up the largest portion of the total cut flower import at 33.9%. With excellent quality ensured from farming in alpine regions and reasonable price, chrysanthemums imported from Malaysia registered a sharp increase from 19.9% in 2001 to 58.1% in 2010. With the import of low-priced Chinese chrysanthemums increasing from 3.3% to 18.8% during the same period, the portion of import from the countries is gradually increasing.

 

Flower import to Japan by country (unit: 1,000 yen)

 

2005

2006

2007

2008

2009

2010

2011

Total

23,858,016

26,259,504

27,995,981

26,341,639

26,017,458

30,770,581

29,325,817

Malaysia

4,542,712

5,731,397

6,261,872

6,284,886

6,320,923

7,603,344

8,052,467

Columbia

3,037,350

3,499,020

3,923,136

4,208,252

4,223,813

5,432,071

5,217,373

Taiwan

2,032,491

2,104,214

1,826,526

2,187,276

2,234,874

2,999,728

3,009,954

China

1,634,002

2,254,818

2,742,106

2,542,145

2,581,249

2,860,385

2,775,827

Thailand

3,001,413

3,413,549

3,961,842

3,323,934

2,982,936

3,116,222

2,643,174

S.Korea

2,279,937

1,557,996

1,389,833

1,430,439

1,673,670

2,227,511

1,740,064

Vietnam

720,841

828,761

983,788

999,241

1,243,910

1,305,656

1,455,563

New Zealand

1,629,574

1,584,754

1,715,424

1,330,840

1,258,945

1,368,104

1,164,680

Netherlands

1,290,478

1,207,022

1,087,389

893,337

722,746

943,018

810,868

Kenya

487,042

932,706

937,328

571,307

491,606

601,668

699,776

Ecuador

596,961

661,644

599,669

326,076

298,321

414,865

427,562

Australia

 

722,738

624,143

 

 

462,600

365,223

South Africa

284,247

223,714

220,310

218,075

183,376

312,948

267,969

India

427,144

649,128

698,475

505,957

419,744

351,898

175,532

Ethiopia

 

12,239

87,844

246,844

228,465

239,045

110,801

Israel

156,042

141,769

154,084

107,620

69,552

88,461

96,493

Singapore

447,187

192,996

151,708

109,303

88,992

82,696

70,354

Zimbabwe

55,927

39,356

41,118

44,692

50,415

54,765

64,327

Indonesia

24,508

19,911

67,383

46,410

35,937

49,275

62,308

USA

134,579

140,202

122,799

36,300

54,203

39,217

40,589

Mauritius

61,486

 

64,673

66,723

69,608

 

37,884

Turkey

80,874

104,888

119,059

44,895

40,460

55,843

37,029

Phillipines

524

5,064

10,257

15,110

17,199

30,112

 

Italy

59,122

73,482

89,267

77,044

48,658

35,345

 

Belgium

 

 

1,337

1,365

8,750

3,713

 

Chille

2,616

18,620

27,625

38,073

6,832

5,745

 

Peru

3,655

3,897

6,626

4,869

7,329

8,759

 

Etcetra.

867,304

135,619

80,360

680,626

654,945

77,587

 

Source: Flower statistics from Ministry of Finance, Japan