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Rise and fall of Dutch peppers in Japan

How did peppers get to Japan? Frederik Vossenaar of the Ministry of Agriculture, Fisheries, Food Security and Nature shares a bit of history following a recent visit to Japan, during which a friend suspected that the pepper had come there via the Dutch. Frederik was able to confirm this.

Start of exports
In 1993, the Netherlands received permission to export peppers to Japan, among other things. "Before then, this fruit vegetable was completely unknown. Yes, local peppers were there, those small ones, with a thin skin, quite bitter in taste. Years of negotiations had preceded that market access, and exports could only start after all sorts of arrangements had been made in the Westland to monitor the presence of the dreaded Mediterranean fruit fly."

But it was finally allowed in early 1993. Only: who wants to buy peppers if no one knows what you can do with them? Budgets from the then Product Board Fruit & Vegetables included cooking demonstrations. "Retail was soon interested, but found it annoying that the Dutch supply was not year-round. Dutch companies provided additional exports, especially from New Zealand."

Rise of South Korea
Very soon, trade from South Korea also took off. "The market access for Dutch peppers in Japan caused a lightning-fast development of Korean greenhouse horticulture. Nobody there cared about sales on the local market; export to Japan was the holy grail, and large subsidy pots were available to boost that. Dutch greenhouse builders and other suppliers profited."

Korean growers first had to get used to the horticultural bonanza in the region. At the time, Frederik was agriculture council at the embassy in Seoul, and curious local growers would walk in the door of the agriculture council, he recalls. "Our greenhouses come from the Netherlands, as do our seeds, our rock wool, our climate control, and we have a Dutch horticulturist as manager. Now, for our exports to Japan, can we get boxes with 'Product from Holland' on them?" He also reminds me of a phone call in the middle of a stormy night. "Good morning Mr Vossenaar, a window of our glasshouse is broken, what should we do?"

Decline in exports
Dutch pepper exports to Japan have declined in recent years. "High air freight rates played tricks on trade for a long time and now it is the exchange rate that makes our exports very expensive. There is also a decreasing enthusiasm among growers to meet the strict Japanese requirements. The export value of Dutch peppers to Japan, which ten years ago hovered around 20 million euros or something like 5,000 tonnes, has now ended up at between two and four million after a downward kink in corona year 2020, a volume under 1,000 tonnes. It was not just our exports that fell: Korean exports to Japan, which stood at around eighty million euros with a volume of over 30,000 tonnes between 2015 and 2020, ended at a volume of just over 20,000 tonnes in 2023."

Increase in domestic production
The decreased Japanese imports are mainly a reflection of increased domestic production, Frederik observes. "A lot has changed in recent years. Exact figures on increased domestic production are lacking, but in the supermarkets I walked into, almost all peppers came from Miyagi, Ibaraki, Okayama, Oita, Koichi or Saitama."

Smart Farming is currently in a strong growth phase in Japan. "Structural changes such as land reforms to promote the use of abandoned land and encourage large-scale farming have already yielded the first results. Smart Farming is being promoted by progressive legislative reforms such as the use of drones or self-driving vehicles, crop protection reforms and the rapid, comprehensive rollout of necessary infrastructure such as 5G, the QZ Satellite System or standardised data platforms.'

Another interesting trend is the increasing involvement of companies that until recently were not interested in farming, such as ICT companies like NTT or Fujitsu or the energy company TEPCO.

Dutch know-how
The biggest challenges are related to the general state of agriculture in Japan, the Japan expert states. "The high and still rising average age of farmers makes it difficult to implement new technologies. Many lack ICT knowledge, and retaining skilled workers who can handle new technology is difficult. High investment costs for greenhouses were already a major obstacle for Japanese agriculture anyway, and with current exchange rates this is more true than ever."

However, the scope for increasing domestic production is there, and horticulture is therefore one of the themes that the Netherlands will showcase at Osaka Expo 2025. Dutch Greenhouse Delta is working on programming the activities.

Source: LinkedIn Frederik Vossenaar

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