With very little commercial production of feed grains domestically, Japan's feed industry relies almost entirely on imported grains. Corn ordinarily makes up about half of all feed ingredients. For decades, the United States has provided over 90 percent of import supplies of corn to Japan. Following unstable corn supply from the United States in Marketing Year (MY) 2012/13 due to drought, which resulted in U.S. corn's import market share falling to a low of 23 percent, the market share of U.S. corn recovered to 90 percent in the latter half of MY 2013/14. For the first four months of MY2014/15, the market share of U.S feed corn gradually declined to 54 percent, as Japan imported second crop corn from Brazil prior to the new crop arriving from the United States. The market share of U.S. corn is expected to recover in the latter half of MY 2014/15.

The table below shows a detailed breakdown of the feed ingredient utilization ratio. In the first eight months of Japanese Fiscal Year (JFY; April-March) 2014, the ratio of corn in feed mostly recovered from the short corn supplies of JFY2012 and 2013, to around 45 percent. The total production volume of compound and mixed feed in JFY2013 was below 24 million metric tons (MT) for the first time since JFY2004, and is on track to be even lower in JFY2014. With declining livestock numbers, feed production is not expected to increase in the near future, but is expected to remain around this level. Use of rice and DDGS has increased notably in JFY2014. Unlike corn, rice and DDGS are used primarily for poultry feed – approximately 70 percent of rice and 60 percent of DDGS.

Feed Utilization by Ingredients (Unit: MT)

Japan Fiscal Year (April-March)

Corn

Sorghum

Wheat

Wheat Flour

Barley

Rice

Rye

Other Grains

DDGS

Non-grain Ingredients

TOTAL

2004

11,853,348

1,395,749

90,306

127,382

770,921

285,932

259,442

123,399

NA

9,062,877

23,969,356

49.50%

5.80%

0.40%

0.50%

3.20%

1.20%

1.10%

0.50%

37.80%

100.00%

2005

11,894,303

1,335,574

101,539

122,738

792,159

325,605

233,518

119,150

NA

9,228,722

24,153,308

49.20%

5.50%

0.40%

0.50%

3.30%

1.30%

1.00%

0.50%

38.20%

100.00%

2006

12,017,330

1,280,438

103,640

129,212

826,682

425,942

219,254

126,810

NA

9,291,274

24,420,582

49.20%

5.20%

0.40%

0.50%

3.40%

1.70%

0.90%

0.50%

38.00%

100.00%

2007

12,005,863

1,137,809

95,075

131,695

859,952

557,571

152,506

143,979

NA

9,434,064

24,518,514

49.00%

4.60%

0.40%

0.50%

3.50%

2.30%

0.60%

0.60%

38.50%

100.00%

2008

12,059,732

1,240,344

111,597

145,387

859,024

468,000

60,739

153,138

NA

9,449,421

24,547,382

49.10%

5.10%

0.50%

0.60%

3.50%

1.90%

0.20%

0.60%

38.50%

100.00%

2009

11,908,859

1,722,923

164,014

136,567

911,019

256,020

53,924

145,614

NA

9,554,496

24,853,436

47.90%

6.90%

0.70%

0.50%

3.70%

1.00%

0.20%

0.60%

38.40%

100.00%

2010

11,614,834

1,464,181

223,429

135,379

901,680

401,463

103,389

152,545

219,189

9,321,592

24,537,681

47.30%

6.00%

0.90%

0.60%

3.70%

1.60%

0.40%

0.60%

0.90%

38.00%

100.00%

2011

10,935,808

1,413,787

402,609

151,537

878,047

652,573

74,028

149,393

362,970

9,218,996

24,239,748

45.10%

5.80%

1.70%

0.60%

3.60%

2.70%

0.30%

0.60%

1.50%

38.00%

100.00%

2012

10,317,271

1,653,366

965,993

159,886

900,739

472,131

16,739

150,236

426,965

9,053,078

24,116,404

42.80%

6.90%

4.00%

0.70%

3.70%

2.00%

0.10%

0.60%

1.80%

37.50%

100.00%

2013

10,445,875

1,511,073

853,214

158,600

896,174

512,132

16,870

146,597

472,613

8,925,813

23,938,963

43.64%

6.31%

3.56%

0.66%

3.74%

2.14%

0.07%

0.61%

1.97%

37.30%

100.00%

2014/April

917,235

62,998

42,945

13,596

72,117

65,161

1,378

10,734

42,831

732,800

1,961,795

46.80%

3.20%

2.20%

0.70%

3.70%

3.30%

0.10%

0.50%

2.20%

37.40%

100.00%

May

928,828

63,901

40,263

13,585

72,312

68,367

1,200

10,857

43,972

740,113

1,983,398

46.80%

3.20%

2.00%

0.70%

3.60%

3.40%

0.10%

0.50%

2.20%

37.30%

100.00%

June

868,846

59,963

37,763

13,175

68,119

65,765

1,115

10,282

41,607

697,202

1,863,837

46.60%

3.20%

2.00%

0.70%

3.70%

3.50%

0.10%

0.60%

2.20%

37.40%

100.00%

July

873,013

71,437

38,848

14,084

71,905

74,907

1,361

10,899

43,127

724,780

1,924,361

45.40%

3.70%

2.00%

0.70%

3.70%

3.90%

0.10%

0.50%

2.20%

37.80%

100.00%

Aug

817,140

71,253

36,232

13,451

66,793

72,785

1,263

10,663

41,220

685,182

1,815,982

45.00%

3.90%

2.00%

0.70%

3.70%

4.00%

0.10%

0.60%

2.30%

37.70%

100.00%

Sept

860,661

77,402

38,126

13,271

69,337

79,819

1,354

11,218

43,351

718,213

1,912,752

45.00%

4.00%

2.00%

0.70%

3.60%

4.20%

0.10%

0.60%

2.30%

37.50%

100.00%

Oct

938,718

89,533

38,062

14,406

75,441

93,757

1,574

12,206

50,451

779,499

2,093,647

44.80%

4.30%

1.80%

0.70%

3.60%

4.50%

0.10%

0.58%

2.40%

37.23%

100.00%

Nov

859,572

84,426

33,309

13,078

65,952

91,655

1,278

11,219

48,469

709,500

1,918,458

44.80%

4.40%

1.70%

0.70%

3.40%

4.80%

0.10%

0.58%

2.50%

36.98%

100.00%

April-Nov

7,064,013

580,913

305,548

108,646

561,976

612,216

10,523

88,078

355,028

5,787,289

15,474,230

45.65%

3.75%

1.97%

0.70%

3.63%

3.96%

0.07%

0.57%

2.29%

37.40%

100.00%

Source: Feed Supply Stabilization Organization

Feed Utilization by Ingredients and Use in Japan Fiscal Year 2013 (April 2013 - March 2014, Unit: MT)

Corn

Sorghum

Wheat

Wheat Flour

Barley

Rice

Rye

Other Grains

DDGS

Grain Total

Non-grain Ingredients

Total

Layer

2,957,665

286,497

45,986

3,093

0

168,961

0

3,445

279,019

3,744,666

2,409,202

6,153,868

48.1%

4.7%

0.7%

0.1%

0.0%

2.7%

0.0%

0.1%

4.5%

60.9%

39.1%

100.0%

Broiler

1,625,092

528,803

43,109

13,555

528

172,062

12

6,281

50,932

2,440,374

1,383,046

3,823,420

42.5%

13.8%

1.1%

0.4%

0.0%

4.5%

0.0%

0.2%

1.3%

63.8%

36.2%

100.0%

Poultry Total

4,582,757

815,300

89,095

16,648

528

341,023

12

9,726

329,951

6,185,040

3,792,248

9,977,288

45.9%

8.2%

0.9%

0.2%

0.0%

3.4%

0.0%

0.1%

3.3%

62.0%

38.0%

100.0%

Dairy Cattle

1,297,102

21,922

77,434

30,806

72,455

31,868

5,515

16,908

58,084

1,612,094

1,479,691

3,091,785

42.0%

0.7%

2.5%

1.0%

2.3%

1.0%

0.2%

0.5%

1.9%

52.1%

47.9%

100.0%

Beef Cattle

1,747,885

50,153

77,514

45,315

740,306

17,677

3,413

11,498

24,612

2,718,373

1,750,961

4,469,334

39.1%

1.1%

1.7%

1.0%

16.6%

0.4%

0.1%

0.3%

0.6%

60.8%

39.2%

100.0%

Cattle Total

3,044,987

72,075

154,948

76,121

812,761

49,545

8,928

28,406

82,696

4,330,467

3,230,652

7,561,119

40.3%

1.0%

2.0%

1.0%

10.7%

0.7%

0.1%

0.4%

1.1%

57.3%

42.7%

100.0%

Swine

2,596,984

618,981

602,884

63,286

68,283

117,894

138

95,798

55,435

4,219,683

1,733,068

5,952,751

43.6%

10.4%

10.1%

1.1%

1.1%

2.0%

0.0%

1.6%

0.9%

70.9%

29.1%

100.0%

Feed, Other

23,366

2,924

174

1,718

1,463

139

0

937

203

30,924

31,040

61,964

37.7%

4.7%

0.3%

2.8%

2.4%

0.2%

0.0%

1.5%

0.3%

49.9%

50.1%

100.0%

Compound Feed Total

10,248,094

1,509,280

847,101

157,773

883,035

508,601

9,078

134,867

468,285

14,766,114

8,787,008

23,553,122

43.5%

6.4%

3.6%

0.7%

3.7%

2.2%

0.0%

0.6%

2.0%

62.7%

37.3%

100.0%

Mixed Feed

197,293

1,879

6,466

827

13,307

3,531

7,792

11,730

4,328

247,153

138,482

385,635

51.2%

0.5%

1.7%

0.2%

3.5%

0.9%

2.0%

3.0%

1.1%

64.1%

35.9%

100.0%

Feed Total

10,445,387

1,511,159

853,567

158,600

896,342

512,132

16,870

146,597

472,613

15,013,267

8,925,490

23,938,757

43.6%

6.3%

3.6%

0.7%

3.7%

2.1%

0.1%

0.6%

2.0%

62.7%

37.3%

100.0%

Source: Feed Supply Stabilization Organization

Japan maintains a feed price stabilization program, whereby the combination of a subsidy by the Ministry of Agriculture, Forestry and Fisheries (MAFF) and an industry fund helps absorb sudden surges in compound feed prices. The feed price stabilization program was revised in April 2014, allowing for the activation of supplemental compensation during times of rising prices. Reflecting the continued depreciation of the yen, imported feed grain prices have risen since the 1st quarter of JFY2014 (April – June 2014). As a result, the compensation was activated for the 3rd quarter of JFY2014 (September – December 2014), as the average price of the imported feed grains for the quarter (33,979 Yen/MT) was higher than the standard import price (the average price of the previous 12 months) of 33,165 Yen/MT. Thus the difference between these two prices, 800 yen/MT, was paid to farmers as regular compensation.