Analysis of self-supplying ratio on domestic pork cut meat and influence of pork price stabilization system and pork import system in Japan

The domestic distribution style on pork has changed from carcass to cut meat recently. In 2001, therefore, pork cut meats are mainly distributed in Japan, but both the existing domestic pork price formation system on the wholesale markets and pork import system are still based on carcass distribution. The purpose of this study is to analyze the self-supplying ratio on Japanese domestic pork cut meats and the influence of the existing systems that stabilize fluctuations in pork carcass prices and regulate pork import (differential tarrif system). The main findings of this study were as follows : (1) During 1988-2000, the amount of pork cut meat distribution slightly increased from 1.43 million tons to 1.55 million tons in Japan, but self-supplying ratio on total pork cut meat decreased from 77.7% to 58.0%. (2) During 1988-2000, the self-supplying ratio on Tenderloin decreased from 56.2% to 26.1%, the self-supplying ratio on Loin decreased from 63.1 % to 32.2%, the self-supplying ratio on Belly decreased from 76.7% to 54.4%, and the self-supplying ratio on Shoulder decreased from 87.3% to 73.4%. But during the same period, the self-supplying ratio on Ham increased from 84.0% to 95.0%. The import pork cut meats have increased because Japanese people prefer Tenderloin and Loin to the other pork cut meats as table meat and the shortage of domestic pork Tenderloin and Loin has occurred. (3) In 2000, the amount of chilled pork meat supplied from North American Free Trading Agreement Area was 88% of total chilled imported pork cut meat and the ratio on chilled pork meat to the total imported pork cut meat was 29%. (4) In 2000, annual sales by wholesale price per year on Japanese domestic pork cut meats were YEN150.9 billion (Shoulder), YEN141.4 billion (Loin), YEN128.1 billion (Ham), YEN106.1 billion (Belly), YEN23.5 billion (Tenderloin), and YEN12.6 billion (Others) respectively. (5) During 1995-2000, the ratio of yearly amount of pork cut meat traded on the Japan Meat Distribution Center (Kawasaki, Osaka and Nagoya) to total Japanese domestic pork cut meat increased from 5% to 16%. That's a 12.3-point jump from the all-time low of 3.5% in 1977. (6) Japanese selected companies (meat processors) have made profits mainly as commission merchant. In 1999, out of 10 high-ranking meat processors, 7 companies' handling share as the commission merchant were more than 50% of their total sales and 3 companies' handling share as the commission merchant were within the range of 30%-50%. (7) I believe the Japanese domestic pork cut meat had suitability as the benchmark of pork price which could be traded on the pork futures market in Japan.