ZEN-NOH Report 2019 We, the ZEN-NOH Group, Are the Trusted and Reliable Go-Between Linking Producers and Consumers

The Wengfu & Zijin Chemical Industry Co., Ltd. ammonium phosphate plant/Shanghang, China ZEN-NOH Report

A farm engaging in contracted cultivation of rice/Saitama Prefecture

A yakiniku restaurant operated directly by JA ZEN- A truck delivering gasoline and other NOH Meat Foods Co., Ltd. products to JA-SS service stations Yakiniku Honpo Pure Kitasenju Marui/Tokyo

Angele, a mini tomato for which ZEN-NOH is the sole seed supplier

TAMAGO COCCO, a sweets shop operated directly by JA ZEN-NOH Tamago Co., Ltd./Tokyo

The Southern Prefecture VF Station, which packages strawberries/Fukuoka Prefecture

JA Farmers Tomioka, which includes a direct-sales shop for domestic farm products/Gunma Prefecture

ZEN-NOH Grain Corporation’s grain export facility with expanded loading capacity/New Orleans, La., U.S.A.

National Federation of Agricultural Cooperative Associations JA is the abbreviation for Japan Agricultural Cooperatives. 1-3-1 Otemachi, Chiyoda-ku, Tokyo 100-6832 Tel: +81-3-6271-8055 Fax: +81-3-5218-2506 Website: www.zennoh.or.jp Published in September 2019 ZEN-NOH Group Corporate Identity ZEN-NOH Report 2019 We, the ZEN-NOH Group, are the trusted and reliable go-between linking producers and consumers. 4 Message from ZEN-NOH Representatives

We think about peace of mind from three points of view: Three-Year 6 Changing business environment ・Efforts to support farm management and lifestyles, and to create vibrant production centers Business Plan 8 ZEN-NOH's courses of action for the next 5-10 years Delivering to consumers domestically-produced fresh and safe agriculture and livestock products ・（FY2019-2021）・Proactive efforts to protect the earth's environment 10 Top-priority measures

12 ZEN-NOH as a cooperative JA Manifesto 15 We, members, employees and officers of JA, act in accord with the fundamental definitions, values and principles of cooperative union The SDGs and co-operative initiatives activities (independence, self-reliance, participation, democratic management, fairness, and solidarity). We will forecast environmental 16 International network changes from a global perspective and renovate our organization, business, and management. We will also cooperate with cooperatives in local communities, across the country, and all around the world, in an effort to realize a more 18 Product introductions democratic and fairer society. To this end, we will fulfill our role in society as a community-based agricultural organization sincerely, by carrying out the following initiatives. 20 Nationwide Store Network We will: 1. Develop agricultural industries in regions to protect the food, nature, and water of our country. 22 Smart agriculture 2. Build local communities where people can live a safe and bountiful life by making a contribution to the environment, culture, and welfare. Special feature 3. Achieve cooperative results through active participation in and solidarity with JA. 23 Yume Farm ZEN-NOH is set up to demonstrate technologies and how to 4. Ensure sound management of JA and strengthen confidence in JA in accordance with the principles of independence, self-reliance and manage greenhouse for maximizing income of Japanese growers democratic management. 5. Pursue the achievement of meaningful lives together through learning the spirit of cooperation and implementing cooperative activities. 24 Technological development to support productivity improvements

26 Principle 3 ZEN-NOH’s Rice and farm produce business Co-operative identity, values & Member Economic Participation Members contribute equitably to, and democratically control, the businesses 28 Fruit and vegetables business principles in the 21st century capital of their co-operative. At least part of that capital is usually the common property of the co-operative. Members usually receive limited The ICA Declaration on the identity of cooperatives 30 Livestock product sales business compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: 32 Definition of a Co-operative Export business Developing their co-operative, possibly by setting up reserves, part of A co-operative is an autonomous association of persons united voluntarily 34 to meet their common economic, social, and cultural needs and aspirations which at least would be indivisible;Benefiting members in proportion to Production materials business through a jointly-owned and democratically-controlled enterprise. their transactions with the co-operative; and,Supporting other activities Fertilizer business, agrochemicals business, approved by the membership. Co-operative values agricultural machinery business, farming and Principle 4 Co-operatives are based on the values of self-help, self-responsibility, Autonomy and Independence packaging materials business, feed business democracy, equality, equity and solidarity. In the tradition of their Co-operatives are autonomous, self-help organizations controlled by founders, co-operative members believe in the ethical values of honesty, their members. If they enter into agreements with other organizations, 40 Energy business openness, social responsibility and caring for others. including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain 41 Life support business Principles their co-operative autonomy. The co-operative principles are guidelines by which co-operatives put 42 Facilities and agricultural residential business their values into practice. Principle 5 Education, Training and Information Co-operatives provide education and training for their members, elected representatives, managers, and employees so they can contribute Principle 1 Voluntary and Open Membership effectively to the development of their co-operatives. They inform the 43 Disaster recovery and restoration Co-operatives are voluntary organizations, open to all persons able to use general public, particularly young people and opinion leaders, about the their services and willing to accept the responsibilities of membership, nature and benefits of co-operation. without gender, social, racial, political or religious discrimination. Principle 6 Co-operation among Co-operatives 44 Social Responsibility Activities Principle 2 Democratic Member Control Co-operatives serve their members most effectively and strengthen the Co - operatives are democratic organizations controlled by their co-operative movement by working together through local, national, members, who actively participate in setting their policies and making regional and international structures. 46 JA Group Organization and Businesses decisions. Men and women serving as elected representatives are Data accountable to the membership. In primary co-operatives members have Principle 7 Concern for Community 47 ZEN-NOH’s organizational structure equal voting rights (one member, one vote) and co-operatives at other Co-operatives work for the sustainable development of their communities Financial Information levels are also organized in a democratic manner. through policies approved by their members. 48

Source: JA Handbook for Executive Ofﬁcers/Zenkoku Kyoudou Publishing Co. Ltd. 50 Public-relations 2 3 Message from ZEN-NOH Representatives TOP MESSAGE With an eye on ﬁ ve and 10 years from now

Continuing to move forward powerfully We wish to offer our sincerest thanks for the in response to dramatic changes in international tremendous cooperation and support that the ZEN- conditions. To connect the rails we have laid through NOH Group enjoys in its businesses. To realize these initiatives, we must review the existing functional divisions within the JA Group and now with those to the future This fi scal year is the fi rst year of our new three- control business operational costs throughout the JA year Medium-Term Plan. Under this three-year Group as a whole. For this purpose, we will engage in Medium-Term Plan, together with continuing to full discussions with JAs on matters including optimal accelerate autonomous reform efforts based on the allocation of our management resources. In addition, fundamental approach of doing everything to benefi t we will expand the businesses of the JA Group our members, consumers, and the general public, and ZEN-NOH and maximize returns to members Unite, Our Challenge, Our Future we also will deploy initiatives with an eye toward through establishing integrated group management to the future fi ve and 10 years from now, to respond to demonstrate the comprehensive abilities of the entire the dramatic changes now underway in production, ZEN-NOH Group, including subsidiaries. distribution, and consumption structures as well as Priority measures intended to expand the value the international situation. of total agricultural production will include use of new technologies to increase productivity, support The catchphrase of this three-year Medium- for addressing shortages in agricultural labor, Term Plan is "Unite, Our Challenge, Our Future" This and utilization of information and communication Chairman of President & CEO, phrase embodies our resolve to build a new future technologies (ICT). Through such efforts, we will Supervisory Board Board of Directors by boldly taking on the challenges of new business contribute to increasing food self-suffi ciency rate and domains while also combining our strengths together to community development by realizing sustainable nationwide with an eye toward the future and fully agriculture, through providing backing support for Yutaka Nagasawa Shuji Yamazaki carrying out autonomous reform initiatives with all of business succession for family farms and community our strength. management organization and new business entries in the agricultural fi eld. The courses of action that we will aim to have achieved fi ve and 10 years from now are based on the Over the past three years, ZEN-NOH has laid the following foundations, on which we will build related rails on the route toward reform and carried out a wide concrete measures. range of efforts based on them. Over the coming three First, we will establish and implement strategies years, we will continue to move forward powerfully for individual produce and product categories, toward through the concerted efforts of all ZEN-NOH Group systematic and incremental growth in the value of management and staff to connect these rails with total domestic agricultural production. those to the future that lies ahead. Second, we will fi rmly develop sales strategies for the individual produce and product categories in which We will appreciate your continued cooperation and production will expand. understanding with regard to the operations of the Third, we will strive to build healthy local ZEN-NOH Group in the future. communities.

Fourth, we will develop new international strategies

4 5 Three-Year Unite, Business Plan Our Challenge, Consumption trends (FY2019-2021) Our Future Against a backdrop of rising needs for easy-to-prepare meals amid Fig. 1. Changes in numbers of increasing numbers of single-person and dual-income households, the home households by number of members meal replacement and food service markets are growing. (Fig. 1, Fig. 2) In 53.34 million households the grocery retail market, sales by convenience stores and drug stores are Surpassed 50 million growing, while the e-commerce market also is growing and new demand is households! 2004 rising rapidly, such as that for serving foreign visitors to Japan. (Fig. 3) 3127 Changing business environment In addition, a program requiring labeling of the production centers of raw materials used in processed foods was enacted in September 2017, and its full 1488 3 or more 2178 implementation will be completed in April 2022, after a transitional period. This persons 62% is expected lead to increased demand for domestically-produced agriculture 1842 and livestock products, by serving as an effective criteria in consumers' 2 persons 526 30% product choices. At the same time, there are concerns about the impact on the 1 person 423 Downsizing and restructuring of agricultural production 1975 2015 (Year) food-service and other industries of the increase in the consumption tax rate Source: Ministry of Internal Affairs and Communications, National Census planned for October 2019. As the agricultural workforce decreases rapidly, the labor shortage is intensifying due to the aging of farmers and a lack of members of the next generation of farmers. (Fig. 1) Fig. 2. Changes in the size of the home meal Fig. 3. Changes in the number of foreign visitors The production infrastructure also is weakening due to factors such as increases in abandoned cultivated land. (Fig. 2) (JPY trillion) replacement and food service markets (JPY trillion) to Japan and travel consumption by value 25.7 25.8 On the other hand, due to an increase in corporate farming organizations and the rising presence of large-scale farming in farm 13.0 26.0 4.5 25.4 25.4 Number of foreign visitors to Japan 4.4 management, the number of young new farmers aged 49 and younger is trending at around 20,000. (Fig. 3, Fig. 4) (10,000 visitors) 12.0 25.0 Travel consumption by 3.7 24.6 3.5 Food service market size value (JPY trillion) 24.0 Fig. 1. Changes in the farming population Fig. 2. Changes in abandoned cultivated land 11.0 24.0 (Age) 42.3 (10,000 ha) 39.6 23.2 10.3 70 10.1 2.0 Average age 40 Land owned but not farmed 38.6 22.8 9.8 10.0 9.6 23.0 Sufﬁciency farming (Thousands) 65.8 66.4 66.7 66.8 34.3 9.3 1.4 63.2 60 Farming for sale 8.9 3,119 5,000 61.1 9.0 8.7 22.0 1.1 2,869 59.1 20.5 0.8 16.2 18.2 8.4 2,404 30 Size of the meal-replacement market 1,974 Farming population 50 13.3 4,000 8.0 21.0 1,341 4,140 24.4 836 1,036 3,891 622 Halved in 40 21.7 7.0 20.0 3,000 3,353 20 8.3 2011 2012 2013 2014 2015 2016 2017 2018 (Year) 20 years 5.6 7.9 2011 2012 2013 2014 2015 2016 2017 2018 (Year) 6.6 9.0 9.0 Source: Based on data from the Japan Ready-made Meal Association and the Japan Sources: Based on data from the Japan Tourism Agency and the Japan National 2,606 30 13.5 Foodservice Association. Tourism Organization 2,000 3.8 4.1 2,097 4.2 1,816 10 1,753 20 1.9 15.5 1,000 14.4 11.3 12.0 12.4 12.7 Conditions faced by the JA Group 7.3 JA's economic businesses are experiencing decreasing trade volumes due to contraction of the agricultural production 0 0 1995 2000 2005 2010 2015 2017 2018 (Year) 1985 1990 1995 2000 2005 2010 2015 (Year) infrastructure. JA's business environment is growing tougher in other ways as well, including a situation in which the earnings capabilities of JA's credit and mutual insurance businesses decline as an unavoidable consequence of the lengthening of the policy of Source: Based on Ministry of Agriculture, Forestry and Fisheries, “Census of Agriculture Source: Based on Ministry of Agriculture, Forestry and Fisheries, and Forestry” and "Survey on Movement of Agricultural Structure" “Census of Agriculture and Forestry” negative interest rates in Japan. Under such conditions, in order for JA to establish a sustainable business foundation and maintain levels of member services, there is a pressing need to improve the earnings ability of its economic businesses through cooperative efforts with producers to establish production infrastructure and strengthening sales capabilities. Fig. 3. Trend in number of corporate farming organizations Fig. 4. Change in numbers of new farmers

(Farmers) (Organizations) 50 or older 49 or younger 20,000 18,857 Other Trends in agricultural policies and the international situation 769 70,000 Various organizations 810 65,030 Companies 60,150 There are concerns about the impact on domestic agriculture of further progress in trade liberalization, including the U.S.-Japan 58,120 57,650 Agricultural cooperative corporations 60,000 56,480 55,670 55,810 Trade Agreement on Goods (TAG), TPP11, and the Japan-EU Economic Partnership Agreement (EPA). In addition, the agricultural 15,000 54,570 50,810 field, which suffers from an increasingly severe shortage of workers, is an industry subject to the amended Immigration Control and 12,511 50,000 Refugee Recognition Act, which took effect in April 2019. 387 652 12,115 Internationally, subjects of concern include the impact on grain markets of intensification of the U.S.-China conflict, rising energy 40,000 10,000 prices due to instability in the Middle Eastern situation, and the impact of Britain's withdrawal from the EU. 8,700 378 643 30,000 8,395 In light of these circumstances, over the next three years (FY2019-2021) we plan, under the 20,000 5,000 6,016 basic stance of "benefiting all members, as well as consumers and the public," to continue 5,163 10,000 accelerating autonomous-reform initiatives as well as deploying initiatives with an eye toward 3,077 1,663 0 0 five to 10 years in the future, in response to rapidly changing production, distribution, and (Year) 2010 2011 2012 2013 2014 2015 2016 2017 2018 (Year) 2005 2010 2015 consumption structures and the international situation. Source: Based on Ministry of Agriculture, Forestry and Fisheries, Source: Ministry of Agriculture, Forestry and Fisheries, “Census of Agriculture and Forestry” “Survey on Newcomers in Agriculture” 6 7 Three-Year Unite, Business Plan Our Challenge, Developing sales strategies Support for creating (FY2019-2021) Our Future based on market needs healthy rural communities

Together with expanding sales in the fresh-foods ﬁ eld, one of Together with enhancing businesses that support community ZEN-NOH's strengths, we also will strengthen efforts to address lifeline services based on the facts on the ground in agricultural demand for processing and commercial uses. In addition, by communities, mountainous regions, and other localities, ZEN- developing products with the high added value that consumers NOH also will attract people and consumption into rural areas (i.e., ZEN-NOH's courses of seek, based on domestic and international market needs, and stimulate demand), through means such as capturing demand expanding consumption of agriculture and livestock products from inbound tourists and rural lodging businesses, to contribute through diverse sales channels, the ZEN-NOH Group will secure a to regional development by stimulating local economies and action for the next 5-10 years position as a top Japanese food brand. developing healthy communities.

Systematic expansion, in stages, of total agricultural production, through formulation of strategies for individual crops and products

Total domestic agricultural production in 2017, the most recent year for which ﬁ gures are available, was JPY9.3 trillion, down JPY2.4 trillion from its 1984 peak. To realize sustainable agriculture, we will introduce a wide range of measures to stimulate regional production and establish production infrastructure, based on training and securing agricultural workers. These will include ① new technologies to improve productivity, ② support for securing the workforces needed, and ③ utilization of ICT.

Changes in total agricultural production Processed agricultural products Livestock Other crops Vegetables Rice 1984 (peak) (JPY trillion) JPY11.7 trillion -JPY2.4 trillion 2017 12 9.3 trillion 10 Developing new international strategies in response 8 to rapidly changing international trends

Amid a rising protectionist 6 trend, as seen in U.S.-China trade frictions, there are concerns about 4 an increasing lack of transparency in international grains markets and 2 a global economic slowdown. For this reason, ZEN-NOH will develop new international strategies 0 in areas such as enhancing 1980 198119821983198419851986198719881989199019911992199319941995199619971998199920002001200220032004200520062007200820092010 201120122013201420152016 2017(Year) its procurement capabilities Source: Based on Ministry of Agriculture, Forestry and Fisheries, "Statistics of Agricultural Income Produced" for feed grains, fertilizers, and other materials and increasing

In addition, of the total of 88 million tons of agriculture and Food Self-Suffi ciency Table (FY2018) Unit: 10,000 tons exports of domestically-produced agriculture and livestock products livestock products consumed per year in Japan, about one-half Foreign trade Food intended for domestic consumption Domestic is produced domestically, while imports are relied on for the rest. Type/item Feed materials by developing supply chains linking production Imports Exports Volume For this reason, ZEN-NOH intends to contribute to increasing (included in above) domestic production centers with Grains 918 2,470 12 3,330 1,477 Japan's food self-suffi ciency through efforts to expand domestic customers overseas. Rice 821 79 12 845 43 production, by formulating product-specifi c strategies such as: Corn 0 1,576 0 1,564 1,201 Full self-suffi ciency in products for which Japan has ① Produce Vegetables 1,131 331 1 1,461 0 the production capacity to satisfy domestic demand Fruit 283 466 6 743 0 (rice, eggs, etc.) Other 587 483 2 1,081 9 ② Expanding production of products for which domestic Subtotal 2,918 3,750 21 6,615 1,486 Maximizing returns to all stakeholders demand is not satisfi ed fully (wheat, soy, etc.) Meat 337 320 2 655 0 Shifting to domestic production of products for which Eggs 263 11 1 274 0 To realize the above initiatives, it will be essential to review the existing functional subdivision within the JA Group and keep down ③ Livestock import volumes are high (vegetables etc.) Milk and dairy products 728 516 3 1,243 3 the Group's overall operating costs. To do so, ZEN-NOH is moving forward with thorough discussions with JA on topics including optimal allocation of our management resources. We also will grow the businesses of both the JA Group and ZEN-NOH and maximize ④ Export of products for which Japan has international Subtotal 1,328 847 6 2,171 3 competitive advantages. Total 4,246 4,598 27 8,786 1,489 returns to members, by demonstrating the comprehensive power of the ZEN-NOH Group, including subsidiaries, and establishing Note: "Other" under agricultural products indicates the total of potatoes, starches, and pulse. Groupwide management. Source: Based on Ministry of Agriculture, Forestry and Fisheries, “Food supply/demand” table 8 9 Three-Year Unite, Business Plan Our Challenge, Value chain (FY2019-2021) Our Future Forestry, Agriculture Related distribution fi s h e r i e s JPY1.8 trillion JPY10.9 trillion JPY32.7 trillion

Acceleration of autonomous reforms Main progress on autonomous reforms (FY2018) Expanding direct sales ① Proactive deployment of measures including direct business discussions with users Rice: 1.29 million tons in FY2018 Varieties, seedlings Farmers Packing, Wholesale markets, Transport Food retail, transportation wholesalers e-commerce to sell rice, fruits, and vegetables directly and expand items purchased for resale, Fruit and vegetables: 349.7 billion yen in FY2018 development of facilities related to direct sale, and investment in and alliances with Increase in purchases for resale Food-product Food service producers industry other businesses Rice: 530,000 tons in FY2018 Materials supply Related JPY37.7 trillion JPY28.5 trillion ② To maximize beneﬁ ts of scale in the JA Group, expanding joint purchasing of materials Consolidation of brands and standards of materials industry investment JPY2.1 trillion JPY2.1 trillion through centralization at ZEN-NOH and increasing the numbers of products purchased General chemical fertilizers: from 547 to 25 total brands centrally, development wide-area logistics systems, and using these to improve Cardboard: standards reduced by 18% efﬁ ciency and slim down procurement and supply structures Agricultural ICT (onions, yams, bell peppers) and other new Restaurants Expanding exports through developing supply ③ Standards for direct shipment of technologies Processing, chains linking domestic production centers to agricultural chemicals to farmers expanded manufacturing buyers overseas, sharing information on exports, Exports From 21,000 ha in FY2016 to 104,000 ha Fertilizers, Agricultural JPY0.5 trillion and strengthening negotiating capabilities through Joint purchase of tractors agrochemicals, machinery, production centralization of the function at ZEN-NOH agricultural materials facilities FY2018: 853 units (large tractors of 60-hp class) Taking on the challenge of a JPY100 trillion market to build the value chain Exports of agricultural Top-priority measures products,

The following ﬁ ve top-priority measures will be implemented to give concreate form, as much as possible, to ZEN-NOH's ideal courses of action in the coming three years. Support for creating Development of healthy rural communities international strategies

Establishment of production infrastructure ① Through efforts such as restructuring, strengthening, and ① Strengthening competitive advantages in exports, through improving the efficiency of facility functions centered on means such as increasing sales in existing export markets, ① To address labor shortages in the fi eld in agriculture, implementing diverse labor produce direct-sales facilities, JA consumer shops, and other expanding export production centers, increasing sales through support measures suited to the needs of local farmers and JAs, investing in and facilities, building stronger communities through measures to e-commerce initiatives in various countries, and joint logistics/ partnering with production corporations organized by JAs, supporting efforts to secure sustainable lifelines in mountainous regions distribution with other companies secure and train agricultural workers, etc. ② Stimulating local communities through increasing numbers of ② Strengthening procurement capabilities for raw materials ② Adoption and promotion of innovative technologies such as fully automated drones large-scale A-Coop stores combined with directly operated and other materials, through means such as enhancing and Z-GIS and other agricultural ICT systems, to help improve the efficiency of shops (JA Farmers) and consumer businesses suited to new relationships with agricultural cooperative organizations in agricultural work and farm management demand such as that from inbound tourism. other countries, overseas suppliers, and others and opening ③ Expanding cultivation under contract with clearly defi ned buyers, for products such ③ Supporting community lifelines through expanding the facilities overseas as rice, fruits, and vegetables for processing and commercial use electricity business, deploying the home energy business, and ④ Providing sales-based production solutions and related materials and services cutting the costs of energy used in agricultural management ⑤ Promoting production to replace imported livestock products with domestic products for certain specifi c items ⑥ Infrastructure development including business facilities, software, etc. for deploying the measures above Establishing a position as the top food brand

① Growing market shares in production of food products, food processing, and food service, through enhancing product-development capabilities and proposing products chosen by consumers and other buyers ② Further deployment of technological and business alliances with various firms, Strengthening support for JAs toward development of value chains from production through consumption ③ Diversification and expansion of sales channels through means including full- ① Providing support for efforts such as the following in order to deliver practical support for JAs' efforts to strengthen their business fledged deployment of e-commerce businesses, responding to new inbound- foundations: enhancement of farmers' adaptability, enhancement of sales capabilities, rationalization of logistics, integrated tourist demand, and business deployment in the home meal replacement and food management of and contracting to facility businesses, and development of production centers service markets ② Practical implementation in the fi eld of autonomous reforms by JAs and ZEN-NOH, to contribute to increasing farmers' income ④ Development of infrastructure, including business facilities and software, to deploy and expanding agricultural production the measures above ③ To implement the measures under ① and ② above, providing integrated support, including human-resources support, to JAs in cooperation with CHUOKAI, NORINCHUKIN Bank, and JA SHINREN 10 11 Why cooperatives are important today Cooperatives in Japan and around the world Demonstrating considerable power in the international community as well ZEN-NOH as a cooperative Membership in the ICA, an international ■ Individual regions' turnover and shares of total turnover federation of cooperatives, consists of 301 Total turnover Canada cooperatives from 105 countries, whose Asia * (not including Japan) 1.7% JPY285 worldwide membership totals 1 billion people. Europe 2.7% JPY4.7 trillion JPY7.7 trillion trillion History of cooperatives There are 1,658 cooperatives in the world 56.3% Japan United States JPY160.6 with turnover, including fi nance and insurance % trillion 10.0% 25.3 ICA-member (income from interest and premiums), of more JPY28.6 trillion JPY72.1 trillion organizations World Japan than USD100 million, and their combined total Oceania South Africa countries 1.8% 105 turnover is more than 285 trillion yen. % 15th C. JPY5.1 trillion 1.9 U.K. JPY5.3 trillion 301 organizations 16th C. Industrial Revolution Yui Tanomoshiko Mujin 17th C. Robert Owen’s Worsening of working Community mutual assistance in activities such as Using funds contributed by 1 billion members New Harmony (1825) conditions, falling wages planting and harvesting rice, and supplying labor members to help those in need Source: The World Co-operative Monitor 2015 (ICA),Cooperatives and Employment: a Global Report(CICOPA) 18th C. * Total turnover of cooperatives with turnover of USD100 million or more. The total of individual fi gures may not match total turnover. Rochdale Society of Equitable Germany Hotokusha Senzokabukumiai Pioneers (1844) (1843) Rural credit (1838) The fi rst modern cooperative, in which workers Lent funds to farmers from cooperatives (1862) Established by Yugaku Ohara ZEN-NOH’s standing among cooperatives worldwide 19th C. pooled funds for joint purchase of necessities membership dues, based on Established by Raiffeisen to fund to manage contributed funds to loans independently instead of Sontoku Ninomiya’s Gojoko ICA (International Co-operative assist poor farmers seeking help from the national (1820 ) Alliance) formed (1895) Around the world, cooperatives ■ government, under the philosophy The world’s top fi ve cooperatives by trading volume Industrial Union Act (1900) are involved in a wide range of Italy “One for all, all for one.” The Japanese government supported the businesses including agriculture and National league of cooperatives formation of cooperatives. Patterned on 1 ZEN-NOH (Japan) WWI Toyohiko Kagawa the German Industry and Cooperatives foods, consumer businesses, fi nance, (Lega coop) dissolved (1926) NH Nonghyup (Republic of Korea) JPY3.80 trillion Cooperatives incorporated into (1888-1960) Act, based on Raiffeisen’s rural credit Germany insurance, and public services. A 2 JPY4.60 fascist system Advocated for the necessity of a cooperatives CHS Inc. (U.S.A.) JPY3.17 trillion Hitler takes power cooperative movement, working look at trading volume shows that 3 trillion Italy Nazis dissolve central federation WWII on establishment of purchasing, Nogyokai established (1943) the agriculture and foods segment BayWa Group (Germany) JPY1.78 trillion * FY2016 turnover 20th C. United industrial cooperatives, Three national organizations of consumer cooperatives (1933) consumer, mutual insurance, accounts for 28% of all cooperative 4 formed to lead cooperative credit, and other cooperatives agricultural associations, etc. → Hokuren (Japan) JPY1.53 trillion movement (1945) Euro Coop established Becomes a government organization business, and ZEN-NOH is the largest 5 (1957) The Japanese cooperative in that segment. 0 1 2 3 4 5 (JPY trillion) ICA 100th anniversary Agricultural Co-operatives Act enacted (1947) Co-operative Alliance conference (1995) Intercoop established (1970) Note: Prepared by ZEN-NOH based on data from the World Co-operative Monitor 2018 (ICA) Note: Figures for the NH Nonghyup in the Republic of Korea include fi nancial and insurance group member companies. Nogyokai abolished, JA formed (1948) (chaired by Toyohiko Note: Figures for Hokuren were prepared by ZEN-NOH based on FY2016 Business Results, published by Hokuren. Grounded in freedom, democracy, and Western values Kagawa) formed (1945) Europe cooperative law (2006) → Scope of cooperatives expanded and number of cooperatives increased Agricultural Co-operatives Small and Medium-Sized Enterprise Act amended (2004) Co-operatives Act amended (2006) Partnering with leading agricultural cooperatives around the world 21st C. International Year of Idea and practice of cooperatives added to Regulations on mutual insurance Full-scale revision of operation system and strengthening Cooperatives (2012) UNESCO’s Intangible Cultural Heritage list (2016) business strengthened of regulations on the mutual insurance business …Agricultural cooperative …Joint venture Rabobank GCC Unlike joint-stock corporations, cooperatives are unable (Cooperative bank in the (Joint venture between Illustrations courtesy of: Yugaku Ohara Museum, Hotoku Museum, Kagawa Archives & Resource Center, Robert Owen Society, JA Group Hyogo Editorial supervision: JCA (pp. 12-14) Netherlands, holding partnership GrainCorp of Australia and to invest in or acquire each other. Thus, to ensure stable with Norinchukin Bank) CZL ZEN-NOH Grain Corporation) (Joint venture with CHS) transactions over the long term, based on fostering mutual CHS INVIVO trust through interpersonal exchange we are strengthening (France’s largest COAMO agricultural cooperative) T.J.C. Chemical ZEN-NOH ACA Limited (Brazil’s largest ties with leading agricultural cooperatives around the world (Joint venture with ACA) Co-op Thailand agricultural through the following means: concluding agreements on Cooperatives support communities and livelihoods cooperative) ① stable, long-term transactions, ②establishing joint ventures. CBH 33,000 organizations, 65 million members Cooperatives are organizations that ACA manage their operations based on the Forestry cooperatives: 624 principles of self-help and cooperation from long-term, multifaceted, and Australia U.S. Argentina altruistic approaches, aiming to improve CBH Cooperative CHS ACA the livelihoods of their members. The agricultural cooperative in The largest federation of agricultural Asociacion de Cooperativas They are deeply involved in our Medical welfare cooperatives: 105 University cooperatives: 215 Western Australia, Australia’s cooperatives in North America Argentinas C. L., the largest lives over a broad range of areas from largest cooperative association of cooperatives Agricultural cooperatives: 657 CHS is a leading global agribusiness owned by primary through tertiary industries. Zenrosai: 58 Since CBH began trading with ZEN-NOH in 1971, the 1,100 cooperatives and 75,000 farmers in 48 states in South America Consumer Cooperatives are specifically two cooperatives have built an irreplaceable relationship across the United States. CHS, whose business is like ACA began trading with ZEN-NOH in 1964, and until cooperatives: 549 Credit unions: 261 identified as one of the private- through trade in a wide range of commodities including those of agricultural cooperatives, deals with Fertilizer, now we have exported approximately 10 million tons of Credit cooperatives: 148 sector participants playing roles oats, lupine, barley, wheat, and rapeseed. Barley, in agrochemicals, feeds, foods, etc., and operates 1,500 feed grains to Japan. We are proud of the way grains Business cooperatives: 28,427 particular, is an essential material to production of service stations under the brand of Conex across 19 states in implementing the Sustainable produced by Argentine farmers have contributed to wagyu beef in Japan, as a feed favored by the cattle. We in the United States to supply fuel products. CHS markets livestock farmers in Japan for more than half a century. Development Goals (SDGs), adopted by Labor banks: 13 Fisheries cooperatives: 934 are proud of how Western Australian barley aids in the more than 50 million tons of grain and oilseeds annually to In addition, in 2011 we established a joint venture with the United Nations General Assembly in Workers’ collectives: 340 production of world-famous wagyu beef. domestic and export customers in more than 60 countries. ZEN-NOH in Hong Kong, ZEN-NOH ACA Limited, as our CHS and ZEN-NOH established the joint venture company 2015. Workers’ coops: 25 ties with ZEN-NOH strengthen further through joint called CZL Ltd. in 2012, to provide a steady supply of activities including sale of soybeans to China. Notes:Figures shown represent numbers of cooperatives in Japan (source: Cooperatives Japan, 2018) primarily wheat and barley to the Japanese market. Business cooperatives are organized by small and medium-sized enterprises (SMEs). A requirement for organizing a business cooperative Wally Newman, Chairman Jay Debertin, President and CEO Claudio Soumoulou, Chairman is that at least four businesses (corporations or owner-operator businesses) participate. They are intended to facilitate more effi cient management and improve trading conditions for SMEs. 12 13 Dramatic global acquisitions of agricultural cooperatives in Canada and Australia The SDGs and Many cooperatives worldwide have been acquired by global firms as a result of having shifted to a joint-stock company organizational structure in order to raise funds. While such agricultural cooperatives once accounted for a massive share of grain distribution in their own markets, with co-operative initiatives these organizational changes and acquisitions their shares have fallen. Tough competition is developing in grains markets worldwide as agricultural cooperatives convert to joint-stock companies and then become involved in successive acquisitions. In September 2015, the 2030 Agenda, which included the Sustainable Development Goals (SDGs) as the successors to the Millennium Development Goals (MDGs) established in 2001, was approved by all 193 members of the United Nations General Assembly. 1 The case of ABB Ltd. in Australia 2 The case of AWB The preamble to the Agenda includes the principle that “leave no one behind.” and Viterra Inc. in Canada in Australia Cooperatives, whose basic principle is "one for all, all for one," are specifically identified as one of the important private-sector participants playing roles in implementing the SDGs. Originally, Australia had both packing cooperatives for wheat Originally, AWB was a government agency that resembled an The first shop of the Rochdale Society of Equitable and barley, organized by state, and a state government monopoly agricultural cooperative, with a monopoly on wheat exports and a Pioneers, established in Rochdale, England in 1844 that exported barley. In 2000, these packing cooperatives and the pooling system. In 1998, it established a wholly owned subsidiary state agency converted to joint-stock companies and merged to to which it transferred all of its businesses. In the following year, form ABB Ltd. the original organization was dissolved and stock in the company ■ Idea and practice of ■ United Nations Decade of Family In Canada, four agricultural cooperatives that needed to was split into shares with voting rights, to be held only by farmers, cooperatives added to UNESCO’s Farming adopted in 2017 consolidate their packing facilities in an effort to end losses in their and shares without voting rights. At that time, it remained a joint- grain shipping businesses merged and converted to joint-stock stock company defended against hostile takeovers. Intangible Cultural Heritage list In 2017, the United Nations General Assembly passed a resolution naming the years 2019-2028 the UN Decade of Family companies to raise funds for construction of new packing facilities. Later, in 2008, its articles of association were amended to In 2016, the United Nations Educational, Scientific and Farming, calling on member states to take measures such as In 2007, these became Viterra Inc. Viterra Inc. acquired ABB Ltd. in abolish this distinction in types of stock and make it an ordinary Cultural Organization (UNESCO) added the “Idea and practice of promoting policies on family farming, which plays major roles in 2009 as a means of preventing a hostile takeover. However, in 2012 company, and then in 2010 it was acquired by the Canadian organizing shared interests in cooperatives” to its Representative food security and eradicating poverty and hunger, and sharing Viterra Inc. was acquired by a major European company, Glencore plc. fertilizer company Agrium Inc. List of the Intangible Cultural Heritage of Humanity, based on an knowledge on the subject. Thus, the shift to a joint-stock company organization, intended Only one month later, Agrium Inc. sold its grains segment to application submitted by Germany. The UNESCO committee noted ZEN-NOH will continue activities grounded in the founding to make it easier to raise funds, led in a little over a decade to the major US grains company Cargill Inc., retaining only AWB’s that “cooperatives allow for community building through shared principles of cooperatives with the goals of protecting family farming, acquisition by an overseas company, which in turn led to a major fertilizer subsidiary. interests and values creating innovative solutions to societal which plays very important roles in not only agricultural production decrease in packing share. problems, from generating employment and assisting seniors to but also protecting the land in mountainous regions and elsewhere. urban revitalization and renewable energy projects.” ■ Flow of acquisitions of agricultural cooperatives Australia Canada ■ Examples of the ZEN-NOH Group's efforts to contribute to the SDGs AWB State independent Saskatchewan wheat pool (government agency similar to Packing cooperatives export agency an agricultural cooperative) Converted to joint-stock Alberta wheat pool Subsidiary established company and then merged Manitoba wheat pool AWB Ltd. (1998) ABB Ltd. (2000) United Grain Growers Acquired (Nov. 2010) Acquired (2009) Over time, four cooperatives formed a single large joint-stock company in order to raise funds Agrium Inc. (Canadian fertilizer company) Viterra Inc. (2007) Grains segment sold (Dec. 2010) Acquired (2012) Cargill Inc. (major US grains company) Glencore plc (major European resources company)

■ Differences between a cooperative and a joint-stock company

Cooperative Joint-stock company Organization Members seeking to improve their own living Shareholders who have purchased company stock Purpose Improving members’ living over the long term (not for profit) Pursuing short-term returns (for profit) The Sustainable Development Goals Management Members, users, and management are the same Policies decided on in general meetings of shareholders agreed to worldwide for 2030 Voting rights One person, one vote One share, one vote Acquisition Impossible Possible Operating principles Prioritizing long-term, multifaceted gains based on a spirit of helping each other Prioritizing above all short-term profit through competition

■ The cooperative concept The basic concept behind a cooperative is the spirit of mutual assistance, under which members help The meaning of a cooperative each other instead of working for selﬁsh interests.

A mobile shop in partnership with JA A solar-power support project Employment creation through The Rice Paddy Organism Survey, an utilizing an agricultural facility supporting agricultural labor opportunity to think about the connection between the environment and farming 1 2 3 4 Source: Based on “What is a co-op?” Japanese Consumers’ Co-operative Union 14 15 Overseas subsidiaries etc. Export business Fertilizer, agrochemicals business Feed business ZEN-NOH's overseas offices ZEN-NOH America ZEN-NOH Foods ZEN-NOH Grain ZEN-NOH Grain Brazil ZEN-NOH London 1 7 13 18 21 International network Corporation (ZNA) Europe Co., Ltd. Corporation (ZGC) Holdings Ltda (ZGB) Office ● Established in 1978 (reorganized in ● Established in 2017 (Bulgaria) ● Established in 1979 (U.S.) ● Export ● Established in 2015 ● Packing ● Established in 2014 (reorganized 1982) ● Support for trading partners ● Production and sales of frozen and sales of grains, information of grains, investment in exporting in 2015) ● Expanding exports of for meat ● International trading in cooked rice (e.g., frozen sushi) using collection companies, information collection domestically-produced agriculture fertilizer materials, etc., business rice produced in Japan and livestock products , information ZEN-NOH strives to expand exports also are striving to expand exports of In the feed business, we leverage ZGC development of and business support collection, attendant services of domestically-produced agriculture and domestically-produced agriculture and and CGB to strengthen the origination mostly for trading partners for meat, etc. livestock products and secure stable supplies livestock products through measures such as throughout U.S. Midwest. We affiliate with JA ZEN-NOH International CGB Enterprises, Amaggi Louis Dreyfus 2 8 P&Z FINE FOODS LLC 14 19 22 ZEN-NOH Beijing Office of feed and fertilizer materials through our acquisition of wholesaler companies. agricultural cooperative organizations of Europe Limited (ZIE) Inc. (CGB) ZEN-NOH Holdings ● Established in 2015 (UK) ● Export/ ● Established in 2017 (US) ● Import, ●Acquired in 1988 (U.S.) ●Packing, S. A. (ALZ) ● Established in 1980 (reorganized international network. In the fertilizer businesses, we are various countries such as ACA in Argentina import of wheat variety, feed materials, storage, processing, and sales of storage, and sales of grains in 2010) Support for exports ●Invested in 2017 (Brazil) ● Packing, ● livestock products, etc. livestock products etc. storage, and export of grains of domestic agricultural products, In 2018, new overseas facilities were strengthening ties with overseas suppliers and CBH in Australia. And we are currently assisting in transfer of fertilizer established in Hong Kong and Taiwan, of raw materials, and in 2012 we invested in involved in partnership in both Canada and materials, etc., information collection, JA ZEN-NOH ZEN-NOH Green GrainsConnect Canada attendant services 3 9 15 ZEN-NOH Hay Inc. 20 joining exiting facilities in the US, the UK, Wengfu & Zijin Chemical Industry Co., Ltd., Brazil to provide access to these production International Asia Pte. Resources Thailand Operations Inc. (GCC) ZEN-NOH Singapore and Singapore. (Staff also are assigned to a company producing ammonium phosphate areas. Limited (ZIA) Co., Ltd. ● Established in 1994 ● Established in 2015 ● Packing, 23 ● Manufacture, export, and sale of storage, and sale of wheat, barley, ● Established in 2015 (Singapore) ● Established in 1964 (reorganized Office the overseas facilities of Group member in China, to realize stable supplies of high- forage and other feed materials ● Export/import of rice and wheat in 1977 and 1993) ● Export/import ● Established in 2013 (reorganized companies in Thailand and China.) We quality ammonium phosphate. variety, feed materials, livestock of agrochemicals, chemical products, in 2015) ● Transfer of fertilizer products, etc. food products materials, juices, etc., export support, information collection, attendant ZEN-NOH International T.J.C. Chemical Co., ZEN-NOH Grain services 4 10 16 Hong Kong Limited Ltd. Corporation, Portland ZEN-NOH Hong Kong 6 SFG Holdings Limited 7 ZEN-NOH Foods 8 P&Z FINE FOODS LLC ● Established in 2018 ● Import of ● Established in 1970 (Thailand) Division 24 agricultural and livestock products, ● Manufacture and sale ●Established in 2005 (U.S.) ●Export Office SFG is a wholesaler of food products jointly Europe Co., Ltd. P&Z FINE FOODS LCC is a joint etc. of agrochemicals and sales of grains and forage ● Established in 2018 ● Support acquired in 2016 by ZEN-NOH International ZEN-NOH Foods Europe venture established in 2017 by ZEN- for exports of domestically-produced Europe Limited and Norinchukin Bank. (ZIE holds Co., Ltd. is a joint venture NOH America Corporation (ZNA) and Taiwan ZEN- ZEN-NOH Green agriculture and livestock products, a 90% stake, while Norinchukin Bank holds established in 2017 by ZEN- local wholesalers. It is increasing sales 5 11 17 ZEN-NOH ACA Limited information collection, attendant NOH International Resources Corporation services 10%) The customer base includes about 2,800 NOH Foods Co., Ltd. and of wagyu beef imported from Japan, Corporation (Taiwan) (ZGR), Shanghai Office ● Established in 2011 (Hong Kong) restaurants and wholesale companies in the UK partners including Bulgarian by processing it to meet customer Joint venture with ACA Sale of ZEN-NOH Taiwan ● Established in 2018 ● Import of ● Established in 1991 (reorganized ● grains and oil seeds to Asia 25 and elsewhere. food-product wholesalers. needs (e.g., steak cuts, thin slices). agricultural and livestock products, in 2005) ● Information collection, Office It produces and sells frozen etc. attendant services, assistance with ● Established in 2018 ● Support sushi using rice produced in purchasing of fertilizer materials and for exports of domestically-produced production materials Japan. agriculture and livestock products, information collection, attendant Wengfu & Zijin Chemical services 6 SFG Holdings Limited 12 Industry Co., Ltd. ● Acquired in 2016 (UK) ●Invested in 2012 (China) ● Food importer and wholesaler ●Manufacture of fertilizer materials 20 GrainsConnect Canada Finland Operations Inc. Chemical fertilizer GCC is a joint venture established Canada in 2015 in Canada between Australian Scotland Russia Wheat Barley Alfalfa Pasture grass Rapeseed etc. 14 CGB Enterprises, Inc. grain trading, handling and processing Glasgow Latvia Potassium chloride Potassium chloride Peat moss company GrainCorp and ZEN-NOH ZEN-NOH acquired CGB in 1988 6 Netherlands Peat moss Grain Corporation. Four new grain to strengthen its infrastructure for U.K. Liquid fertilizer Calgary 20 elevators located in the Western London 2 shipping grains from the Midwest, 21 Germany Canadian grain belt are designed to Gasoline United States. The CGB origination develop a stable supply chain of grains Potassium sulfate Pasco France Europe, Black Sea coast Fuel oil grains are exported from ZGC’s such as feed wheat and barley. INVIVO New York facility. Currently, it operates about Corn Wheat Barley China Light oil Portland 15 U.S. Bulgaria 7 Beijing 95 packing facilities with a storage Plovdiv Beets Alfalfa etc. Soybean cake etc. Heavy oil A 16 U.S. Corn Soy Wheat 1 capacity of 5.5 million tons, the Ammonium phosphate 22 S.Korea CHS Barley Pasture grass Beets Milo DDGS etc. Rock phosphate fifth largest in the United States. Rock phosphate Ammonium phosphate Potassium-magnesium-sulphate Morocco Jordan Magnesium phosphate Los Angeles 8 Shanghai 11 13 Ammonium phosphate Liquid fertilizer 14 Rock phosphate Saudi India Shanghang 12 New Orleans UAE 5 25 Taiwan Arabia Soybean cake Hong Kong Taipei LP gas 17 4 24 LP gas Castor bean cake Potassium sulfate 9 10 Vietnam Rock phosphate Thailand Bangkok 19 Amaggi Louis Dreyfus 12 Wengfu & Zijin Chemical Singapore 13 ZEN-NOH Grain Corporation ZEN-NOH Holdings S.A. Industry Co., Ltd. 3 23 ZEN-NOH Grain Corporation was Amaggi Louis Dreyfus ZEN-NOH Holdings Wengfu & Zijin is a large-scale phosphate Malaysia Urea established in 1979 in New Orleans, S.A. is a JV includes operation to source facility built in Fujian Province, China, Louisiana, in the U.S. It handles the Brazil 19 grains and exporting. ZGB (subsidiary of ZGC) by Wengfu Group, a major Chinese largest volume of grains in the world from Corn Soy etc. took a stake in the JV in July, 2017. Brazil has rock phosphate supplier. ZEN-NOH has a single elevator. It serves as a logistics increased production of corn and soybeans, maintained friendly ties with Wengfu facility for buying, shipping, storing, and Brazil and become regular, reliable exporter. We Group over a long period of time through loading feed materials purchased from the COAMO have established our new origination system trading in rock phosphate. It has financed Australia U.S. breadbasket and as an information in Brazil to provide more stable supply of Australia 18 São Paulo and participated in this project from the CBH Cooperative Wheat Barley Milo center, striving to secure stable supplies grains. planning stage, and at present it enjoys a Oats Pasture grass etc. of the main raw materials used in South Africa stable supply of ammonium phosphate and compound feed (e.g., corn). phosphoric acid solution. GrainCorp Corn Argentina Rock phosphate Milo Corn Barley etc. Argentina ■Production centers for fertilizers, ACA feeds, and fuel products

Fertilizers Feed Fuels

16 As of July 2019 17 Product introductions ZEN-NOH Brand : The tastes of Japan

Some ZEN-NOH Group products ﬁ lled with the delicious taste of Japanese agricultural products are introduced below. ZEN-NOH develops and markets processed foods under its own brand, made mainly using domestic agricultural products. With a The ZEN-NOH priority on use of domestic ingredients, a total of about 180 items are brand website offered under the brand, aiming to contribute to safe, comfortable, healthy living. These products are sold through channels such as supermarkets, including ones operated by the JA Group, as well as Wash-free "GABA Alcohol-free amazake Packs of polished rice consumer co-ops, convenience stores, and TV shopping. Koshihikari" contains made from rice in the popular 300 g about five times the koji. Enjoy its rice- Among them, "Okome no Milk" is a unique product that draws size. Consumers can Y-aminobutyric acid based sweetness, out the natural sweetness of rice using proprietary sacchariﬁ cation even sample famous of ordinary white with no added sugar. rice brands. Nitrogen technology, with no added sugar. Products added to the lineup rice. It's a food with It's perfect for packing extends recently including "Mochi Mugi Gohan," made with Japanese barley, functional claims that replenishing the sugar the shelf life by six can help control blood of students preparing and "Kyushusan Yuki Yasai Aojiru," made using organic vegetables months pressure for exams from Kyushu.

"Minna no Yasai" ZEN-NOH is the Safe, reliable, quality products for living peeled, heat-treated A-Coop brand products exclusive provider of vegetables Packed seeds for the baby for making specific plum tomato variety dishes such as pork A-Coop brand is a JA Group brand that prioritizes use of Japanese “Angelle” in Japan. and miso soup, they With low gelatin ingredients. It develops products that make the most of JA's shorten cooking content and a crisp times. They can distinguishing features, reﬂ ecting feedback from JA members and users. texture, it's easy even Cut vegetables produced by Green be stored at room A number of products introduced recently were developed in for children to eat. Message Co., Ltd., a joint venture temperature. between Kewpie Corporation and ZEN- collaboration with seasoning and other companies to deliver a refreshing The domestic rice logo NO. Processing/ commercial use is affixed on products taste to various dishes. These include "A-Coop Homeraresu" vinegar The A-Coop brand whose main ingredients website and "Kantan Wafu Dashi are 100% Japanese rice. Uma! Dashi Pakku"

Dried fruits from "Nippon "Shun no Kajitsu (soup-stock packs) "Nihon no Dried Fruits," Yell," a brand of products Jam" is a series of developed jointly with made using Japanese apples, made from carefully chosen seasonal jams made the National Council strawberries, kiwi, and other Japanese ingredients from Japanese of the Agricultural ingredients. With no added Available in 13 varieties, fruits harvested in sugar or preservatives, you including Ehime Prefecture the year. Please Cooperative Women’s The A-Coop can taste the sweetness, lemons and Yamagata enjoy with bread Association. Brand Publicity acidity, body, and fragrance Prefecture La France pears. or yogurt. They are These are sold at Committee of each fruit. The logo was designed by also excellent for Facebook Kansai Super Studio. making sweets. JA and A-Coop outlets Members of the National Council of the Agricultural nationwide. Cooperative Women’s Association discuss candidate soup- (Not available in some outlets.) stock products for cooking. “Tokutama,” an egg perfectly suited to serving over rice, patented jointly by ZEN-NOH and jd.z-tamago. "Nokyo Milk," Co.,Ltd. "Nokyo Tamago," an original the pioneer in egg brand from speciﬁ ed origins (a nonhomogenized Collaborative products new product introduced in 2019). milk. "Nokyo Coffee," made with 73% Aomori "11/19-B1 Yogurt," made using 11/19-B1 lactic- ZEN-NOH offers numbers products developed in collaboration with other companies. Prefecture milk, acid bacteria, which has high natural immunity is sold in the activity. This product was developed jointly with Kanto region. the University of Tokyo Faculty of Pharmaceutical Sciences and the Genome Pharmaceuticals Institute. A drinkable version also is available

Each 125ml pack of this 100% juice, made using Kawachi Bankan citrus This original curry grown in Ehime Prefecture, contains 6mg of the functional ingredient was supervised auraptene. "POM Ashita no Karada Kawachi Bankan Juice" (left) is a by Japan National food with functional claims that helps middle-aged and older people to Team table-tennis retain their power of recollection (of words and memories). "Tsuburana player Kasumi Kabosu," made using Citrus sphaerocarpa from Oita Prefecture. Enjoy the Ishikawa, who is delicious texture of summer affi liated with ZEN- orange pulp (center). "Ranran The "Sapporo Ichiban Gummy candies, hard candies, and gelatins "Mainichi no Kenkocha," a blend of SOYLETES is a domestic soybean Sliced grilled roast beef made using Hokkaido NOH. Its mellow Rararasakuranbo," made × ZEN-NOH Cup Star" made using Japanese fruit juice from specifi ed grains and green tea made using financier cake for the athlete developed beef Sliced individual-serving packs are flavor is achieved using the juice of Satonishiki series, a collaboration origins, a collaboration with Daiso. 16 types 100% Japanese ingredients, a by supervision of Prof. Kumiko Ebi of perfect for kitchens running short on staff. Its using Japanese cherries from Yamagata with Sanyo Foods Co., include gummy candies made using Oita collaboration with Ito En, Ltd. It Ritsumeikan University. ZEN-NOH's simple seasonings draw out the delicious taste pork, onions, and Prefecture These tart cherries Ltd. So far, 20 varieties Prefecture Citrus sphaerocarpa and hard candies uses 12 healthy ingredients popular collaboration item with Ritsumeikan of the lean meat. carrots. melt in the mouth (right). have been introduced. made with Wakayama Prefecture green plums. among women. University and Matsuo Shouten Inc. 18 19 ●Yakiniku Aguri Maebashi main store Gunma Prefecture ●Yakiniku Aguri Rakurakuen Gunma Prefecture ●Tonami Sodachi Toyama Prefecture ●…Directly operated ●Yakiniku Aguri Nittaan Gunma Prefecture ●Yakiniku Aguri Nodajukuan Gunma Prefecture ●A-Coop Restaurant Isahaya Nagasaki Prefecture ●…Subsidiary ●Yakiniku Aguri Kaburaen Gunma Prefecture ●Miyagi Junmaishu Club Sanaburi Miyagi Prefecture ●Ginga Rikyu Iwate Prefecture Nationwide Store Network ●…Affi liate

The ZEN-NOH Group operates a variety of stores in national production areas and in the greater Tokyo area. We promote domestic farm products directly through a diverse range of stores including direct-sales shops for domestic farm products, restaurants, cafes, and other shops, combined with spaces for holding events. We also are actively expanding our store network overseas, where we have opened Japanese restaurants and yakiniku barbeque restaurants. ZEN-NOH Group ZEN-NOH The goals of these efforts are to promote the high quality, delicious taste, and safety of wagyu beef stores page o f ﬁ c i a l a p p from Japan while also growing its consumption by proposing new ways of enjoying it. Yakiniku Honpo Pure Kitasenju Marui (Tokyo) Kobe Plaisir Ginza (Tokyo) Kokusandori Izakaya Hasedori Akihabara (Tokyo) Niku Bar Tokyo Grill Center Akihabara (Tokyo) Shops & Markets

●ZEN-NOH Antenna Shop Ichigo Ichie Tokyo ●Chokubaijo Pure Kawachi ●FamilyMart +A-Coop Obara Hiroshima Prefecture O f fi c i a l ●Agri Shop Aomori Aomori Prefecture Nagano Osaka Prefecture ●FamilyMart +A-Coop Saijo Hiroshima Prefecture Minori-Minoru Project website ●JA Nosanbutsu ●Chokubaijo Jun Mekkemon ●FamilyMart +A-Coop Iyo Ehime Prefecture Wakayama Prefecture Chokubaijo Aijokan Fukushima Prefecture Hiroba ●A-Coop Sue/JA FARMERS ●Pocket Farm Dokidoki ●Chokubaijo Jun Yumebatake Kasuya Fukuoka Prefecture In 2010, the Minori-Minoru Project was Morioka (opened March 2017 in Morioka ●Minori Cafe Ginza Mitsukoshi Tokyo Fukuoka Prefecture Ibaraki-machi Ibaraki Prefecture Kasuga ●A-Coop Kusu/JA FARMERS ●Minoru Diner Ginza Mitsukoshi Tokyo established to respond to the views and Station Building Fesan), Hiroshima (opened ●Pocket Farm Dokidoki ●Atashi no Chokubaijo Jun Kusu-Kokonoe Oita Prefecture ●Minori Cafe S-PAL Sendai Miyagi Prefecture Fukuoka Prefecture wishes of producers, collected through the March 2018 in Ekie Hiroshima), and Oita Tsukuba Ushiku Ibaraki Prefecture Dazaifu ●Niku no Eki main store Gunma Prefecture ●Grill Minoru S-PAL Sendai Miyagi Prefecture Ehime Prefecture TAC (Team for Agricultural Coordination). It (opened December 2018 in Amu Plaza Oita). ●Kaki Ryutsu Center Shinsen ●Farmers’ Market Iyokkora ●Niku no Eki Raran Fujioka Gunma Prefecture ●Minoru Diner Ekie Hiroshima Hiroshima Prefecture Gunma Prefecture NEW Tokyo involves implementing new business plans In addition, in March 2019 Minori Minoru Gunma Minori-kan ● Tamago COCCO ●Niku no Eki Tamamurajuku Gunma Prefecture ●Minori Cafe Ekie Hiroshima Hiroshima Prefecture ZEN-NOH no Oniku Kobo Gunma Prefecture related to topics on which it was diffi cult for Kitchen, the Group's first home meal ● ●JA Farmers Nodajuku ●JA Green Kanazawa Ishikawa Prefecture ●Minori Cafe Fukuoka Parco Fukuoka Prefecture Sadamoto Chiba Prefecture Gunma Prefecture existing ZEN-NOH business divisions to react replacement shop, selling bento meals ●JA Farmers Asahi-cho ●A-Gaiya Ishikawa Prefecture ●Minoru Dining Fesan Iwate Prefecture JA Green Kanagawa Kanagawa Prefecture Gunma Prefecture swiftly, such as community revitalization, and prepared dishes, opened in Ecute ● ●JA Farmers Annaka ●JA ZEN-NOH Mie Meat O-niku no ●Cafe & Grill Minori Minoru Niigata Niigata Prefecture ●Taberu JA-n Yamanashi Yamanashi Prefecture JA Farmers Brace Gunma Prefecture increasing the self-suffi ciency ratio, gaining Shinagawa, inside JR Shinagawa Station. ● Chokubaijo Mie Prefecture Minori Cafe Takashimaya Kyoto Kyoto Prefecture JA Green Mineyama-Tango ● ● ●JA Farmers Asakura-cho Gunma Prefecture ● Giovanni Iwate Prefecture the understanding of the public regarding Through these outlets, ZEN-NOH offers Kyoto Prefecture Yasai-kan Kicharina Kyoto Prefecture ●Minoru Diner Takashimaya Kyoto ●JA Farmers Ota-Yabuzuka Gunma Prefecture ● Iwachiku Kitchen Morioka Station agriculture, and creating places where menus made using regional ingredients, JA Koryu Hiroba Toretate Genki-ichi ●Minori Minoru Marche S-PAL ● NEW ● JA Farmers Tomioka Gunma Prefecture Fesan Iwate Prefecture producers and consumers can meet. delivers the delicious taste of domestic Yamagata Yamagata Prefecture Hiroshima Hiroshima Prefecture ●JA Farmers Iruma Saitama Prefecture ● Iwachiku Parc Avenue Kawatoku Iwate Prefecture As part of these efforts, in September and regional seasonal ingredients, and also NEW Cafe & Restaurant Minori Minoru NEW ●JA Koryu Hiroba Toretate Genki-ichi Tonari no ● ●JA ZEN-NOH Farmers Lalaport ● Iwachiku Annex Kawatoku Iwate Prefecture Amu Plaza Oita Oita Prefecture Noka Hiroshima Prefecture 2010 Minori Cafe and Minoru Diner provides introductions to regional dietary Izumi Osaka Prefecture ● Shokuniku Chokubaiten Fresh Fukushima Prefecture NEW ● Minori Minoru Kitchen Ecute Shinagawa Tokyo ●JA no Onikuya-san Omachi Hiroshima Prefecture opened in Ginza’s Mitsukoshi Department culture and producers' feelings. NEW ● JA Farmers Tajimanma ● A-Coop Farmers Ueda Nagano Prefecture ●JA no Onikuya-san Hyogo Prefecture Store. These outlets use 100% domestic Wadayama ● A-Coop Farmers Shinonoi Nagano Prefecture Higashi-Onomichi Hiroshima Prefecture ingredients (except coffee and some ●FamilyMart +A-Coop Aikawa Akita Prefecture A-Coop Farmers Minami-Nagano Nagano Prefecture NEW ●JA no Onikuya-san ● ●FamilyMart + ZEN-NOH Fureai Hiroba seasonings), in an attempt to transform the Hiroshima Prefecture ● A-Coop Farmers Bingushi Nagano Prefecture Higashi-Hiroshima Yamagata Prefecture Motosawa Nagano Prefecture structure of the food-service industry, which NEW ●JA no Onikuya-san ● A-Coop Farmers Fujimi ●FamilyMart +A-Coop Kagano Ishikawa Prefecture uses large volumes of imported ingredients, Fukuyama Hiroshima Prefecture ● A-Coop Farmers Pia Midori Nagano Prefecture ●FamilyMart +A-Coop Shinji Shimane Prefecture to increase Japan’s self-suffi ciency ratio. ●JA Green Core Yamaguchi Yamaguchi Prefecture ● A-Coop Takagi (Farmers type) Nagano Prefecture ●FamilyMart +A-Coop Kobu Shimane Prefecture Since then, it has been expanding ●FamilyMart-ZEN-NOH Fresh Hiroba Ehime Prefecture ● Beishin Okome Kitchen Anto Ishikawa Prefecture nationwide, to locations including Fukuoka ●ZEN-NOH no Onikuya-san Ehime Prefecture (opened November 2014 in Fukuoka Parco), ●Hanayaka Seinikuten Okayama Prefecture Kyoto (opened November 2015 in Kyoto ●Antenna Shop Airport Nagasaki Prefecture Takashimaya), Sendai (opened March 2016 NEW ●No SHOP & CAFE musubime Fukuoka Prefecture NEW JA Farmers Iwate Hiraizumi Iwate Prefecture in S-PAL Sendai), Niigata (opened January ● ●Fureai Junjo Ichiba Sakkora Iwate Prefecture Ichigo Ichie 2017 in LEXN2, adjacent to Niigata Station), Cafe & Restaurant Minori Minoru Amu Plaza Oita (Oita) Minori Minoru Kitchen Ecute Shinagawa (Tokyo) Tamago COCCO (Tokyo Otemachi ●Chokubaijo Pure Hino Tokyo (Tokyo) JA Building)

Restaurants Overseas

●La Campagne Tokyo ●Nikusho Jade Kanazawa Ishikawa Prefecture ●Yakiniku Honpo Pure Ikebukuro Tokyo ●SHIKI BEVERLY HILLS U.S.A. ●Kobe Plaisir Ginza Tokyo ●Hidagyu Ryori Takumi Gifu Prefecture ●Yakiniku Honpo Pure Iidabashi Sakura Terrace Tokyo ●TOKIMEITÉ U.K. JA Town ●Iwate Junjomai no Mise/Ginga Diner Iwate Prefecture ●Kobe Plaisir Hyogo Prefecture ●Yakiniku Honpo Pure Kitasenju Marui Tokyo ●Japanese Wagyu Yakiniku Pure 1 (Causeway Bay Store) Hong Kong JA Town is an Internet mall launched by ZEN-NOH in 2001 as a new distribution ●Fukushima-gyu Yakiniku Gyuho Asahi Fukushima Prefecture ●Genki-Ichi Shokudo Hiroshima Prefecture ●Yakiniku Honpo Pure Marui Mizonokuchi Kanagawa Prefecture ●Japanese Wagyu Yakiniku Pure 2 (Tsim Sha Tsui Store) Hong Kong channel for domestic farm products. As Nagasaki Prefecture Osaka Prefecture ●Fukushima-gyu Yakiniku Gyuho ●Nagasaki Wagyu Yakiniku Pure ●Yakiniku/Sukiyaki Jun Umeda Main Store of May 2019, JA Town had grown to 97 Yatsuyamada Fukushima Prefecture ●Kokusandori Izakaya Hasedori Akihabara Tokyo ●Yakiniku/Sukiyaki Jun Osaka Fukushima Osaka Prefecture shops and about 370,000 members. In April ●Pocket Farm Dokidoki Ibaraki-machi Mori no Katei ●Niku Bar Tokyo Grill Center Akihabara Tokyo ●Yakiniku/Sukiyaki Jun Ebista Nishinomiya Hyogo Prefecture 2016, the Furusato Nozei Shien System, Ibaraki Prefecture Ryori Restaurant ●Tonkatsu Butaniku O-ryori Jun Atre Urawa Saitama Prefecture ●Yakiniku/Sukiyaki Jun Tenjin-Kego Fukuoka Prefecture created to support tax payment based on Pocket Farm Dokidoki Tsukuba Ushiku Dokidoki the JA Town system, was developed and the ● ●Yakiniku Pure Kanda Tokyo ●Shinsen Hormone Futsukaichitei Fukuoka Prefecture Restaurant Ibaraki Prefecture service introduced to local governments and Yakiniku Pure Shinbashi Tokyo Yakitori Mizutaki Kandakasiwaki Tokyo ● ● members of the JA Group across Japan. ●Wafu Yakiniku Toyama Sodachi Toyama Prefecture ●Yakiniku Honpo Pure Otemachi Tokyo ●Joshu Wagyu Senmonten Gunma Sodachi Tokyo ●Toyama Sodachi Funahashitei Toyama Prefecture ●Yakiniku Honpo Pure Shinagawa Tokyo ●Yakiniku Aguri Asahian Gunma Prefecture TOKIMEITÈ(London)

20 As of July 2019 21 Special feature Smart agriculture Yume Farm ZEN-NOH is set up to demonstrate Smart Agriculture, which employs technologies such as information and communication technologies (ICT) and robotics in the agriculture ﬁ eld, has been attracting attention in recent years. technologies and how to manage greenhouse ZEN-NOH is working to help improve agricultural productivity and increase farmer’s earnings. for maximizing income of Japanese growers

ZEN-NOH manages its own demo greenhouses to promote elemental technologies to improve income of horticulture growers. Agronomy ※“Yume” means dream in Japanese.

As the scale of agricultural production increases, the effective The Z-GIS is cloud-based GIS system launched in 2018 for ﬁ eld management and securing stable labor has been required. ZEN- agricultural management improvement. The system makes it Yume Farm ZEN-NOH Tochigi Yume Farm ZEN-NOH Kochi NOH is adopting innovative technologies such as fully automated possible to integrate geographical information (ﬁ eld area, weather, drones and agricultural management system to help save labor and sensing data etc.) and agricultural data such as varieties, production In 2014, ZEN-NOH started cultivating Japanese beef This greenhouse was built in Aki-City, Kochi-Prefecture in 2017, to digitalize and visualize agricultural data. records, and agricultural work information. In April 2019, Z-GIS tomatoes with soil in high-tech greenhouse in Tochigi- demonstrate technologies for stable, high-yield eggplant cultivation. This In 2017, we invested in Nileworks Inc., which develops and sells was upgraded to enable the use of some of the 1km-mesh weather City, Tochigi-Prefecture. The yield is over 40 kg/m2 for greenhouse area is 1 ha, the largest greenhouse for eggplant in Japan. Half drones for agricultural use. Drone technology will help to reduce data from APPINES/AgriInfo, a membership-based agricultural four consecutive years. As the result of this project, one of the area is hydroponics and the other is soil. ZEN-NOH labor and production costs in areas that until now have required information service for the JA Group. greenhouse was introduced technologies developed takes on the challenge of achieving the Japanese eggplant considerable labor to apply pesticide, such as mountainous regions. 2 in this project in summer 2019. Additionally, technical highest yield (30 kg/m ) through using new cultivation information is transmitted by means of inspection tours, system. Based on two years of cultivation experience, ZEN- Drones Various sensors Field Soil diagnostics holding technical seminars, and accepting trainees. NOH accelerates efforts to achieve goals and promote environmental data results elemental technologies developed in this greenhouse. Pest-control and fertilizer data Advice on proper Growth data fertilizing Yume Farm ZEN-NOH SAGA

Yume Farm ZEN-NOH SAGA, a largescale cucumber demo greenhouse, Support for management Agricultural Farming Soil-analysis data is under construction in Saga-City, Saga-Prefecture and scheduled to improvements management data management system start operation in winter 2019. This greenhouse will be introduced new Work data eco-friendly system supplying surplus heat and CO2 released from an incineration plant. The target yield is (Field information, production records, 2 management information) 45-50 kg /m , this means twice as Production and Various types much as the prefecture average. sales plans of agricultural A comprehensive partnership agreement has been Support for farm management Fertilizer, information pest-control, concluded with the city of Saga and JA Saga to improvements through the Z-BFM Various types of ensure the smooth operation of Yume Farm ZEN- weather information (Builder of Farm Management) system information from NOH SAGA Note: The information above is a general summary Digitalization of fi eld information APPINES/AgriInfo and includes some planned future alliances. Topic New drone now shipping In October 2017, ZEN-NOH invested in Nileworks Inc., a private-sector startup, and began introducing drone technology for Topic agricultural use. In July 2019, it began shipping the Nile-T19, a fully autonomous drone and its fi rst mass-production model. Livestock This drone is capable of applying agrichemicals and other materials while fl ying over a fi eld registered in advance. AgVenture Lab In the future, ZEN-NOH will work together with Nileworks to use agricultural drone technology to reduce labor and As of May 2019, Mobile Gyuonkei, a system intended to monitor cattle for innovation laboratory opens production costs in areas that until now have required considerable labor to eliminate pests and manage cultivation, such as The fully automated Nile-T19 drone, mountainous regions. now shipping signs of calving, was in use by about 2,000 farmers to help reduce cases of The AgVentureLab innovation laboratory, established death when cattle calves. jointly by ZEN-NOH and eight JA Group federations across In 2017, we invested in Farmnote Holdings Inc. We propose solutions the country, opened in May 2019 as a facility to realize to help farmers improve results using Farmnote Color, which uses sensors open innovation to create new businesses. Topic The agricultural magazine Green Report publishes its 600th issue Based on the concepts of developing agriculture for to detect in real time when cattle are in estrus and increases visibility and Green Report, an agricultural magazine published by ZEN-NOH, publishes its milestone 600th issue in June 2019. It has the next generation, supporting rural communities, and efficiency in breeding management using continued to be published monthly since its fi rst issue on September 1, 1985. linking people with places, it aims to create new businesses, artifi cial intelligence. While when it fi rst started publishing Green Report focused mainly on fertilization and pest-control articles regarding subjects develop new services, and solve societal problems, through The goal is to improve producers' such as fertilizers and agrichemicals, in response to readers' requests it later developed into a comprehensive agricultural co-creation with startups, productivity and earnings by introducing management journal, covering topics such as farming conditions, production techniques and materials, and activities in the partner companies, production fi eld. Currently, it publishes 72,500 copies per issue, of which more than 70% (55,000 copies) are distributed to outstanding technologies from other universities, government farmers. Its role is to serve as a communication tool linking ZEN-NOH with farmers. industries, such as milking robots, cameras, agencies, and other In the future as well, it will continue aiming to provide useful information on agricultural production and management to further and wearable sensors. partners to utilize wide enhance its functions as an informational publication for farmers. ranges of knowledge and Farmnote Color, fi tted to cows to collect technologies. Green Report's 600th issue (June 2019) data on their activities 22 23 Special feature Technological development to Agricultural Research and Development Center The Agricultural Research and Development Center was established in 1962 as a research facility focusing on agronomy. Over the 57 years since then, it has carried out R&D on agricultural production technologies, testing on produce and production materials, support productivity improvements and HR development for the JA Group, to increase the farmers’ disposable income. ZEN-NOH’s R&D units are focusing on both development of technologies that support the everyday activities of producers and fundamental research with an eye toward the future. These initiatives include collaboration between research institutes and also R&D in cooperation with government research institutes and private-sector businesses as well. Agricultural Product Laboratory Fertilizers Laboratory

The Agricultural Product Laboratory develops new varieties of rice, vegetables, To promote proper fertilization based on soil analysis, soil analysis is spray chrysanthemum, and other crops. Crops of the "Harumi" rice variety grown conducted at nine regional soil analysis centers nationwide. It also conducts Central Research Institute for Feed & Livestock Institute of Animal Health by ZEN-NOH are increasing, thanks in part to its having secured a Special A analysis of the nutrient content in the solution using nutriculture and is ranking of flavor. developing nutriculture fertilizer distribution planning software called Yoeki It also develops cultivation technologies to increase productivity, as it develops Meijin. It has developed and brought to market the ZEN-NOH physical properties As a research facility that aids in the management of livestock farms The Institute of Animal Health is the department that strives to and promotes technologies such as subsurface drip irrigation of leeks and direct diagnostics set for use in diagnostics of the physical properties of soil. through innovative products and technologies, the Central Research prevent infectious disease of livestock. It includes a research and sowing of onions. Institute for Feed & Livestock is involved in the commercialization of development section that works on product development of vaccines compound feed and superior breeds and livestock production materials, and feed supplements and basic research on animal diseases. It also the development of technologies related to nutrition management has a diagnostic center, which conducts health inspection of livestock and productivity improvements, holding training courses, and other and provides production guidance (called “clinics”) and five field clinics activities. across Japan. The diagnostic center tests about 200,000 specimens Its recent achievements include ①development of poultry feed to per year, making it indisputably the largest livestock health inspection maximize poultry performance based on breeding improvements, ② facility in Japan. Its field clinics based on the results of inspection are Soil physical development and promotion of pork varieties offering outstanding flavor conducted by veterinarians properties and productivity and of feeds for them, ③ development of technologies assigned to five sites across diagnostics "Harumi" grown by ZEN-NOH A leek drip-irrigation kit Regional soil analysis center set for improving productivity and saving labor in wagyu and dairy cattle Japan— Hokkaido, north using ICT equipment, and of low-cost breeding systems and feeds, ④ Japan, east Japan, west breed improvements through genome analysis, and ⑤ development of Japan, and Kyushu—greatly new methods of analysis of nutrient content of feeds, raw materials, etc. contributing to farmers’ Agrochemicals Laboratory Agrochemical Residue Laboratory productivity improvements. In partnership with agrochemical The Agrochemical Residue R&D on livestock production without relying companies, the Agrochemicals Laboratory tests fruits and vegetables on antibiotics, in response to producers’ and Laboratory develops agrochemicals distributed by the JA Group for consumers’ needs that are highly effective against hard- chemical residues. In 2015, it earned to-control pests and weeds, while Good Laboratory Practice (GLP) Use of the diagnostic center’s new testing building begins also being less labor intensive. It also certification for agrochemicals, and it is striving to promote integrated pest also conducts chemical residue testing Establishing a next-generation model of A new testing building has been constructed at the diagnostic center, to management (IPM) in combination with for agrochemical registration. dairy-farm management program further improve testing capabilities and expand the diverse range of services Control of spider mites by predatory mites Sample preparation offered, including genetic and biochemical testing. The long-awaited new various pest-control methods such as using “Banker Sheet®” (brand name) The Kasama dairy/beef cattle laboratory is carrying out research on building was completed biological control. establishing a next-generation model of a dairy-farm management program, in March 2018. The first intended to achieve labor saving and higher productivity. robotic testing equipment As part of these efforts, it is developing technologies including in Japan was installed in Energy Laboratory Quality Control Office introduction of milking robots, which have been used increasingly in dairy the new building, and it is farming in recent years, special-purpose feeds to maximize performance of used in numerous testing The Energy Laboratory conducts The Quality Control Office handles milking robots, and stabilization of milk fat content, which will be an issue processes today. quality testing of gasoline and quality control (setting quality standards, New testing building Robotic testing equipment when adopting robotics. other petroleum products. It also product inspection, plant inspection, provides support for earning national labeling inspection, specifications control) qualifications and improving workers' to support the safety and reliability ET Center skills through activities such as training of A-Coop brand products and others. sessions related to liquified petroleum It also carries out efforts to promote (LP) gas. understanding of product knowledge ET (Embryo Transfer) technology is used to transfer an embryo The ET Center’s ET activities Quality testing of petroleum products among members of JA women's from one cow to another for birth. The ET Center is a pioneer associations and others. in this technology, and it boasts world-leading ET technologies. Ordinary Artificial insemination To increase production of wagyu beef, an important asset of birth Production Materials Laboratory Seminars Japanese agriculture, the ET Center helps to support the wagyu Embryo Transferred to Wagyu calves harvested wombs of dairy born from production through ET using Holstein cows. (See illustration at from cow cattle dairy cows The Production Materials Laboratory's The Center holds training sessions on right.) Currently, the Center supplies about 25,500 bovine embryos Artificial insemination activities include quality control for individual topics such as agribusiness and 1,100 pregnant heifers to farmers across Japan each year. materials like cardboard boxes for fruits and materials for JA Group staff. Since Production The Center is also focusing on development of new technologies efficiency and vegetables and plastic used in the Center opened, it has trained a and new products as well as offering special training programs improved greenhouses, developing new materials cumulative total of more than 140,000 ET birth Embryo-providing by up to 21 (commonly called as Hanshoku Gijuku) intended to train young cow times* to keep fruits and vegetables fresh, trainees. Since FY2015, it has held generations to be professionals in ET. Using the wombs of dairy cattle makes and checking the performance of new training sessions on cultivation methods it possible to produce large numbers of products. It also holds basic training for those involved in development of wagyu cattle from a single wagyu cow sessions on agricultural equipment and producing regions. ※ 5 times/year × 7 calves/time × 60％＝ 21 calves/year conducts service technician certifying Quality checking of cardboard boxes using Number of times/ Number of Embryo A training session on cultivation methods year embryos harvested embryos harvested acceptance examination, etc. pressure testing equipment from one cow each time rate 24 25 ZEN-NOH’s businesses

Rice and farm produce business ZEN-NOH’s initiatives ■ Proposing production of high-yield rice and other products suited to commercial needs

Current state To help stabilize the rice production businesses of producers, ZEN-NOH proposes rice production based on user needs in cooperation with JA. Demand has been growing in recent years for rice varieties for the commercial market, ■ The share of large-scale Trend in area farmed by rice growers used in home meal replacements, food service, and other fi elds. In response to such changes in demand trends, ZEN-NOH proposes to producers, farmers, and others production of rice 2005 2010 2015 farmers is growing varieties for the commercial market, centered on high-yield varieties and has been advancing Less than 2 ha 60% 48% 40% efforts to promote cultivation under contract, with quantities and prices specifi ed in advance Large-scale farmers share of rice production is growing. The share 2-5 ha 22% 21% 20% for several years. accounted for by producers growing rice on 10ha or more was 26% in 5-10 ha 10% 12% 14% Specifi cally, in addition to proposing varieties suited to producers' and farmers' regions and business conditions, such as crop diversity and 2015, up nearly fourfold from 10 years earlier. 10 ha or more ７% 19% 26% blight resistance, ZEN-NOH also is developing new varieties suited to farmers' production needs. It also proposes a range of solutions to help

Source: Based on Ministry of Agriculture, Forestry and Fisheries, “Census of Agriculture and Forestry” cut ZEN-NOH production costs (such as reducing costs of production materials and labor), together with supporting cultivation through use of data and knowledge accumulated through now. ■ Growing demand for home meal replacements and food service In 2019, the new Rice Production/Origination Division was established at the Head Ofﬁ ce. In cooperation with prefectural headquarters and JAs, it promotes production proposals and contracted cultivation based on ascertaining production region needs through visiting large-scale Due to increasing demand for shorter cooking times and simplified dining, due to factors such as rising numbers of single-person producers and corporations. households and dual-income households, the home meal replacement and food service markets are growing. Home meal replacements and food service also account for a rising share of rice consumption, reaching approximately 30% in 2017. Producers Fig. 1. Trends in numbers of households with full-time Fig. 2. Home meal replacement/food service Producers' needs for stable ●Want to engage in stable transactions unaffected by crop situations and market prices homemakers and dual-income households and home cooking shares of rice consumption ●Want to distribute labor during peak periods, in response to labor shortages management ●Want to secure stable sales channels..., etc. Households with full-time homemakers

Dual-income households 11.88 million households Promoting contracted cultivation of commercial rice varieties 70.9% Dining at home 79.7 Commercial users Users' needs for ●Want to use rice varieties suited to processing stable supplies ●Want to trade in stable price ranges, (a wide range of needs by industry) since dramatic ups and downs in purchase prices would be troubling..., etc. 6.41 million Meal replacement/ households 29.1% 20.3 food service 1997 2017 (Year) 1980 1985 1990 1995 2000 2005 2010 2015 2017(Year) Source: Ministry of Agriculture, Forestry and Fisheries, “Annual Report on Food, ■ Enhancing and increasing direct sales to users Sources: Ministry of Health, Labour and Welfare, “White Paper on the Labour Economy,” Cabinet Ofﬁ ce, “White Agriculture and Rural Areas in Japan” Paper on Gender Equality,” Ministry of Internal Affairs and Communications, “Special Survey of the Labour Force Survey,” Ministry of Internal Affairs and Communications, “Labour Force Survey (Detailed Tabulation)” Ties are being strengthened with users, rice wholesalers, and others through Packed rice and promoting investment and business alliances. In 2018, capital and business alliances mochi from Sato Foods Co., Ltd. were forged with Kitoku-Shinryo Co., Ltd., a major rice wholesaler, and Sato Foods Co., ZEN-NOH’s role Main distribution channels for rice handled by ZEN-NOH Ltd., a major producer of packed rice and mochi. In addition, to increase consumption by proposing new ways of eating rice, a capital and business alliance was formed with Yuwaeru Inc., a producer of packed brown rice, and to achieve goals such as creating ZEN-NOH Pearl Rice new ways of eating rice, such as rice noodles, and develop new producer regions, a The rice business delivers rice collected from Retail shops, and companies producers through the JA network to consumers Producers JA processors, Consumers capital and business alliance was formed with Meal Works Co., Ltd., which operates Thai JA etc. etc. restaurants and produces and sells rice noodles made from domestic Japanese rice and through rice wholesalers, manufactures, and other KEIZAIREN Wholesale farina. Packed brown rice businesses. It handles a wide range of products from Yuwaeru Inc. including not only rice consumed as a staple food companies but also raw-material rice such as that used in brewing sake or producing rice flour, glutinous ■ Promotion of domestic soybeans and wheat rice, feed rice used to feed livestock, and rice for Main distribution channels for soybeans handled by ZEN-NOH export to overseas markets. Recently more people have become health conscious, and wider generations consumes The farm produce business handles wheat and soybean products such as natto and soy milk. And as a result, demand for domestic soybeans barley, soybean and the local specialties such as ZEN-NOH has been increasing. ZEN-NOH aim for construct the stable supply system by production starch which are highly valuable for the society. and Processors Producers JA Wholesalers Consumers promotion as well as supporting of production technology for increasing the unit crop, and It also handles dried shiitake mushrooms and JA etc. KEIZAIREN working on the contract farming which brings farming land and demand together. Furthermore, processed fruit products (such as raw fruit juice as for the wheat, the number of bread, udon noodles and other products which are emphasized and jams). use of domestic wheat are increasing, and in order to meet the requirement of quality and quantity, ZEN-NOH is promoting the pre-seeding contract. 26 27 ZEN-NOH’s businesses

Fruit and vegetables business ZEN-NOH’s initiatives ■ Expanding direct sales Trend in planted and cultivated Vegetables Current state land for fruits and vegetables. Fruit trees Efforts are underway to clarify priority trading partners and expand infrastructure related to direct sales by ZEN-NOH and ZEN- (10,000ha) NOH Fresh Produce Marketing Corporation and forward direct trading in cooperation with partner markets. Direct sales of JPY430 60 58.8 54.7 55.9 55.1 53.1 54.0 billion (up 23% vs. 2018) are planned in 2021. 51.2 50 49.6 ■ Shrinking production infrastructure 47.5 47.2 46.9 43.4 42.2 for fruits and vegetables 40 38.2 ■ Business alliances with home meal replacement/ food service suppliers and others 34.2 31.0 30 28.1 Total land under cultivation for fruits and vegetables have 25.9 24.0 Business alliance agreements were concluded in March 2018 with Delica Foods Holdings Co., Ltd., Kanemasa Distribution Group, 22.3 22.0 21.6 decreased by approximately 200,000 ha over roughly two 20 and M.V.M Shoji Co., Ltd. Through strengthening ties with each company, proactive progress will be made on deploying integrated decades through 2017, due to causes such as the aging of efforts from production through sales, through means including development of contracted producer areas, joint use of infrastructure producers and a shortage of labor. (From 898,000 ha in 1995 10 and logistics networks, joint product development, and expansion of sales channels. to 685,000 ha in 2017) 0 For this reason, there is a pressing need to take measures 1975 1980 1985 1990 1995 2000 2005 2010 2015 2016 2017 (Year) to maintain and expand production infrastructure. Source: Based on Ministry of Agriculture, Forestry and Fisheries, "Vegetable Production/Shipment Statistics" and "Cultivated and Planted Land Statistics." ■ Infrastructure development of regional ■ Growing the processed Note: Figures for vegetables are for planted land, while ﬁ gures for fruit are for cultivated land. collection, shipping, and other facilities food-products business ■ Vegetable imports are Fig. 1. Domestic and increasing, centered on Production volume To reduce producers' burdens in selection, sorting, and adjustment Amid rising demand for processed food products, since 2016 ZEN- (10,000 t) imported vegetables Imports work, ZEN-NOH is opening new regional collection, shipping, and NOH Fresh Produce Marketing Corporation has produced and sold 2,000 other facilities as well as facilities related to direct sales. processing and commercial uses 1,800 "Minna no Yasai" heat-treated and prepared domestic vegetables. 50 87 155 1,600 10 23 263 312 Green Message Co., Ltd., established as a joint venture between 337 1,400 4 278 294 290 313 Vegetable imports have been rising since the 1980s, and 1,200 2 ZEN-NOH and Kewpie Corporation, in recent years approximately 3 million tons of vegetables— 1,000 produces and sells cut vegetables. (Its 800 equivalent to one-fourth of domestic production—have been 600 plant began operation in April 2015.) 400 imported. (Fig. 1) 200 In addition, as demand for frozen fruits 0 At the same time, against a backdrop of simplification 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2016 2017 (Year) and vegetables grows, it is advancing of meal preparation and increased dining out,* demand Source: Based on Ministry of Agriculture, Forestry and Fisheries, “Food supply/demand” table fully into the frozen fruits and vegetables

for vegetables is shifting from household consumption to business, through means including "Minna no Yasai" prepared processing and commercial uses. Roughly 60% of demand Fig. 2. Vegetable demand for processing and commercial planning a new frozen vegetables plant. vegetables. for vegetables is for processing and commercial uses. (Fig. 2) uses and for household consumption The majority of imported vegetables are destined for Sorting strawberries at the Fukuoka prefectural headquarters' Southern VF Station processing and commercial uses, and about one-half of Household consumption vegetables for processing and commercial uses are imported. For these reasons, conversion from imported to domestic Imports (included above) ■ Joint business vegetables in processing and commercial uses is a key point Processing/ commercial use initiatives with JAs related to increasing domestic production. Imports (included above) * The prepared dish (home meal replacement) market is growing, reaching a scale of Through means such as strengthening guidance on agricultural Cut vegetables produced by Green JPY10 trillion in 2017. (See p.7) 1990 2015 (FY) techniques by JAs and enhancing ZEN-NOH's sales capacity, the Message Co., Ltd. Frozen vegetables at the Tochigi prefectural Source: Based on data from the Policy Research Institute, Ministry of Agriculture, Forestry and Fisheries headquarters division of responsibilities within the JA Group is being revised to help improve producers' earnings and maintain and expand the integrated Groupwide production infrastructure. ■ Improving logistics effi ciency ZEN-NOH’s role Main distribution channels for fruits and vegetables handled by ZEN-NOH Producers JA ZEN-NOH We are setting up stocking points in production centers and ZEN-NOH Wholesale consumer regions, to establish a joint shipping structure extending In the fruits and vegetables business, Fresh Regional joint-use facilities across prefectural boundaries, in response to logistics issues such fresh produce collected from producers Produce as a shortage of qualifi ed truck drivers. via JAs is delivered to consumers through Marketing Shipping ZEN-NOH Retail Sorting Storage Sales Market We also participate in the Agriculture Pallets Promotion Council, channels including ZEN-NOH Fresh Produce and Corporation shops, Producers JA Consumers Shipping under established in August 2018, to promote streamlining of logistics Marketing Corporation, wholesale markets, JA processors, Produce guidance on agricultural Supply of raw through joint use of pallets. materials retailers, and food processors. KEIZAIREN etc. techniques Shipping Sales Actual Processing (packaged A pallet used by the Agriculture Wholesale facilities processed consumers markets foods) Pallets Promotion Council, fi tted with an IC tag read at each stage of the logistics process to prevent loss and misuse. 28 29 ZEN-NOH’s businesses

Livestock product sales business Egg business It delivers domestically produced eggs and processed products to consumers nationwide through joint efforts with designated producer Topic Tamago COCCO, a specialist Current state centers and the feed division as well as struggles to improve the quality. As Japan's largest receiver of eggs, JA ZEN-NOH Tamago Co., Ltd. in sweets made using eggs publishes market egg prices and plays a major role in stable distribution Trends in numbers of farms and numbers of stock of eggs. It is striving to increase sales of fresh, delicious, safe Japanese- In 2016, JA ZEN-NOH Tamago Co., Ltd. began its entry to the ■ Increase in number of stock per farm 1960 1980 2000 2019 produced eggs. sweets production and retail business, opening the sweets shop Number of farms (Farms) 410,400 115,400 33,600 15,000 Dairy Tamago COCCO. As a place where customers can learn first- Number of stock 823,500 2,091,000 1,764,000 1,332,000 cattle (Head) hand about the wonders of domestic eggs, Tamago COCCO offers While the number of farms raising livestock decreases, the Head per farm (Head/farm) 2 18 53 89 puddings, egg tarts, madeleines, and other sweets made using its Number of farms (Farms) 2,031,000 364,000 116,500 46,300 number of stock per farm is increasing as producers grow in scale. Beef Number of stock 2,340,000 2,157,000 2,823,000 2,503,000 prized eggs and domestically produced main ingredients. cattle (Head) ZEN-NOH Group's main egg distribution channels From 2000 to 2019, in addition to the pork and poultry businesses, Head per farm (Head/farm) 1 6 24 54 in which large-scale farming is fi rmly established, the number of Number of farms (Farms) 799,100 141,300 11,700 4,320 stock per farm of dairy cattle grew 1.7-fold to 89 head and that of Swine Number of stock (Head) 1,918,000 9,998,000 9,806,000 9,156,000 Supermarkets, Head per farm (Head/farm) 2 71 838 2,119 ZEN-NOH beef cattle grew 2.2-fold to 54 head. Number of farms 3,487,000 186,500 4,890 2,120 (prefectural co-ops, Egg- (Farms) Producers JA headquarters) JA ZEN- wholesalers, Consumers laying Number of stock (Thousand birds) 79,837 121,822 140,365 141,792 NOH hens Birds per farm (Birds/farm) 23 653 28,700 66,900 and JA processors, Tamago Note: Egg-laying hens: fi gures for 1964 are shown under 1960 and for 1981 under 1980, 2000 and KEIZAIREN etc. 2018 fi gures do not include farmers with less than 1,000 birds. Co., Ltd. In April 2019, it opened at its new location in Tokyo's Ichigaya. Source: Based on Ministry of Agriculture, Forestry and Fisheries, "Livestock Statistics." Trends in consumption of meat and eggs ■ Per-capita annual consumption 20 (kg/person/year) Beef Pork Poultry Eggs of meat and eggs is increasing

15 The trend in consumption of meat and eggs is favorable, ZEN-NOH Chicken Foods' main poultry with per-capita annual consumption increasing year-on-year Poultry business distribution channels in FY2017 for all of the following: beef, pork, poultry, and 10 eggs. Conceivable background factors behind this increase The poultry business not only sells poultry Miyazaki Kumiai in consumption include rising demand for meat in the home and processed food products made from it Chicken Foods meal replacement and food service markets in recent years 5 Corporation but also integrates production, treatment, and as well as increased consumption of chicken breast due to ZEN-NOH Supermarkets, processing. With production facilities in Miyazaki, Kagoshima Kumiai co-ops, the spread of knowledge about its benefi cial effects. Chicken Consumers Kagoshima, and Iwate prefectures, which Producers Chicken Foods 0 Corporation Foods processors, account for about 60% of total domestic poultry 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 Corporation etc. Source: Based on "Annual supply of pure food stuffs per capita" in Ministry of Agriculture, production, ZEN-NOH Chicken Foods Corporation Sumita Foods Forestry and Fisheries, “Food supply/demand” table and its subsidiaries in each prefecture are one Corporation of the largest groups in the poultry industry in Japan, handling everything from production Integration Topic “Wagyu Koshien,” a through treatment, processing, and sales. Meat business national competition for beef cattle raised by Serving as the base for the ZEN-NOH Group’s marketing, processing and distribution of meats high-school students in major consumption areas, the meat business delivers domestic beef, pork, and processed “Wagyu Koshien” is a competition in which The JA Group's main distribution channels for raw milk meat products to consumers in a consistent manner. students from agricultural schools and other high Dairy business schools across Japan compete in the quality of Producers Through its traceability system and other measures, JA ZEN-NOH Meat Foods Co., Ltd. meat from wagyu cattle they raise themselves supplies safe and reliable domestically produced meats. Efforts are being made to expand and in their everyday efforts. This competition has The dairy business coordinates supply and JA and RAKUNOKYO certifi cation under the international Safe Quality Food (SQF) standard at processing facilities and been held every January since it began in January demand for raw milk nationwide through sale to improve product quality. In 2017 it opened a new deli meats plant, as it works enhance the deli 2018, with the twin goals of (1) raising motivation of raw milk, butter, nonfat milk, and other to enter the fi eld of agriculture among high-school ZEN-NOH (prefectural headquarters) and JA KEIZAIREN business for products including roast beef. It also directly operates the Yakiniku Pure restaurant students who can power the future of agriculture, commercial dairy products as well as milk for chain, Jun, Tonkatsu restaurants, and other outlets. (2) encouraging networking among students commercial use. It also carries out initiatives on Designated organization from across Japan who have similar interests and the production side, including efforts to improve increasing their motivation and skills. milk quality and assistance with introduction of ZEN-NOH Main distribution channels for meats handled by the ZEN-NOH Group superior breeds of dairy cattle. It also delivers fresh, delicious milk, including milk under the Dairy processors ZEN-NOH Supermarkets, (prefectural co-ops, Nokyo Milk brand, milk-based drinks, and other Producers JA JA ZEN-NOH Consumers Retail shops etc. headquarters) and Meat Foods processors, etc. products to consumers through affi liated dairy- JA KEIZAIREN industry companies. Co., Ltd. Consumers

30 31 ZEN-NOH’s businesses

ZEN-NOH’s role Overview of export business development Production Overseas Export business center markets In April 2017, ZEN-NOH established the new Exports Supply-chain development JA Promotion Division to promote the export business and develop Restaurants Trends in exports of agricultural, forestry, and JPY906.8 Developing ZEN-NOH production centers for export. With export administration production Current state ﬁ sheries products and food products billion JA JPY807.1 operations centralized at subsidiary JA ZEN-NOH International centers Planning Information Wholesalers, Fisheries products billion KEIZAIREN and proposal collection JPY745.1 JPY750.2 Corporation, this business is establishing new overseas facilities retailers Forestry products billion billion 3,031 Produce and strengthening sales in overseas markets. ZEN-NOH ■ Exports of agricultural, forestry, and JPY611.7 prefectural Questions, Exports JA ZEN-NOH Export JPY550.5 billion 2,749 In addition, it is building efficient shipping systems that headquarters consultation Promotion International growth Supermarkets ﬁ sheries products and food products set a new billion 2,757 2,640 376 maintain freshness through testing and adoption of new Division Corporation JPY449.7 355 billion 2,337 technologies effective for maintaining the quality of fresh fruits Producers record high for the seventh consecutive year 263 268 e-Commerce 2,216 and vegetables, joint distribution, and other efforts. 1,698 211 In 2018, exports of agricultural, forestry, and fisheries 152 118 5,661 4,966 products and food products set a new record high for the seventh 4,431 4,593 consecutive year, at JPY906.8 billion. As domestic food demand 3,569 2,680 3,136 in Japan is expected to fall due to the decreasing population, ZEN-NOH’s initiatives development of export demand will be very important to maintain agricultural production. 2012 2013 2014 2015 2016 2017 2018 (Year) Source: From Ministry of Agriculture, Forestry and Fisheries data

Total: ■ Enhancing sales capabilities JPY38 billion ■ 2019 JA Group target for agricultural exports: JPY38 billion (JA Group agricultural/ Overseas subsidies were established in Hong Kong and Taiwan in 2018, joining the existing economic reforms plan) subsidiaries in the U.K., Singapore, and the U.S. Each overseas facility is strengthening its The Japanese government has set a target for total exports of agricultural, forestry, and Note: FY2020 numerical targets by country and product include the management structure by expanding local hiring efforts. ZEN-NOH also invests in and forges fi sheries products and food products of JPY1 trillion by 2019. Of this fi gure, JPY56.5 billion effects of relaxation of quarantine The opening ceremony for the ZEN-NOH Taiwan Offi ce inspection and other impediments to Rice 50 alliances with companies involved in home meal replacement, food service, and other businesses (approx. 6%) consists of the main products handled by the JA Group, and the Group aims to (August 2018) exports (JPY7 billion). overseas, as well as enhancing its retail business through means including expansion of export JPY38 billion in agricultural exports, or about 70% of the total. e-commerce sales around the world. JA Group export growth targets Total: Fruits and ■ Developing production centers for export vegetables 170 Breakdown of FY2019 Japanese government targets Total: JPY17.9 Total government Fruits and vegetables JPY25 billion JPY16 billion Based on the needs of export markets, ZEN-NOH is expanding production centers for export target for the main Total: billion and adopting shipping structures based on relay networks. It also is carrying out feasibility testing Beef JPY25 billion products handled JPY12.4 Rice 10 by the JA Group: billion Rice 9 of low-cost high-yield rice cultivation. Rice (brown, polished) JPY6.5 billion Fruits and Fruits and vegetables71 Flowers JPY15 billion JPY56.5 Rice 7 vegetables 72 billion Fruits and Beef 130 ■ Logistics Tea JPY15 billion (Total for rice based vegetables 65 on ZEN-NOH Processed foods JPY500 billion Beef 77 To streamline logistics, ZEN-NOH is striving to cut logistics costs through joint logistics and estimates) Beef 61 Hong Kong's jashop.hk (launched June 2019), an Beef 38 shipping with companies in similar and dissimilar industries and to establish techniques for Fisheries products JPY350 billion e-commerce site selling Japanese agricultural Other 30 Other 14 Other 18 Other 21 maintaining freshness through adoption of new technologies. products. Processed rice products (Japanese sake, rice snacks) JPY53.5 billion Forestry products JPY25 billion FY2016 results FY2017 results FY2018 results FY2019 target * FY2019 target fi gures are for JA KEIZAIREN, prefecture JAs, ZEN-NOH, and ZEN-NOH subsidiaries Total JPY1,015 billion Topic Sake brand developed for export only

Exports and imports in Japan and other countries and regions JA ZEN-NOH International Corporation, Nihon to inspire consumers who have never had a drop of ■ Eliminating Shurui Hanbai Co., Ltd., the largest wholesaler of Japanese sake to give it a try. In May 2019, a ship left U.S. EU China Taiwan Hong Kong Singapore Australia alcoholic beverages in Japan, and Ozawa Shuzo Co., port in Tokyo with the first shipment bound for the export barriers Exports Imports Exports Imports Exports Imports Exports Imports Exports Imports Exports Imports Exports Imports Ltd., a sake brewer located in the city of Ome in Tokyo, U.K. ZEN-NOH is striving to grow exports of processed is key Total (JPY100 million) 84 6,831 32 3,327 34 4,808 211 149 254 3 43 18 6 2,949 have developed jointly the Z1 brand of Japanese sake products such as sake. Polished rice ◎◎◎◎○◎◎◎◎◎◎◎◎◎ exclusively for export. The brand name Z1 is intended To increase exports, it will Beef (frozen) ○○○○××○×○×○×○○ Pork (frozen) be important to address import ×○×○××○×○×○××○ Poultry (frozen) ×○×○××××○××××○ restrictions in various countries, Persimmons ○◎○○××○×◎×◎×○× Topic to overcome the negative image ZEN-NOH exhibits in SIAL China 2019 Cherries ×○○×××○◎◎◎◎◎×× overseas due to the 2011 nuclear Grapes ×◎◎○××○○◎×◎××○ In May 2019, ZEN-NOH, ZEN-NOH Foods Co., Ltd., buyers from across China. The rice exhibit, organized accident, and to stimulate recovery Oranges ○◎○○××○×◎×◎××○ and JA ZEN-NOH International Corporation exhibited rice in partnership with a Japanese manufacturer of nigiri- of exports. Melons ×◎◎○×○○×◎×◎××◎ and processed food products jointly with local importers sushi-rice-balls making robots, offered attendees small and wholesalers in SIAL China 2019, under the name nigiri-sushi-rice-balls made of Japanese rice. Despite Cabbage ×○◎○×○○◎◎◎◎◎×◎ ZEN-NOH Group. SIAL China is one of the world's largest severe restrictions on exports, ZEN-NOH will continue Onions ×◎◎○×◎○◎◎◎◎◎×◎ comprehensive food trade fairs, attracting numerous efforts to promote exports to China in the future as well. Notes: 1. Export/import amounts are from actual results for fresh and processed meats; dairy products and eggs; and rice, fruit, and vegetables from 2018 trade statistics. Notes: 2.: ◎permitted unconditionally; ○permitted conditionally or results recorded; ×not permitted 32 33 ZEN-NOH’s businesses

Production materials business Fertilizer business

Fig. 1. Trend in global fertilizer consumption ZEN-NOH’s role The JA Group's main fertilizer distribution channels (Millions t) Nitrogen Phosphoric acid Potassium Current state 200 180 JA Group 160 The fertilizer business supplies producers BB 140 with fertilizers purchased from JA Group BB fertilizer ZEN-NOH 120 fertilizer plants or fertilizer manufacturers, plant ■ High reliance on imports 100 ZEN-NOH and JA for fertilizer and feed raw 80 through JA KEIZAIREN and JAs. It also KEIZAIREN 60 contributes to stable supplies and price stability Overseas 40 in the fertilizer market through importing JA Producers materials 20 mines 0 fertilizer raw materials itself. 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 (Year) Japan relies on imports for nearly all of its * Bulk-blending (BB) fertilizer: Fertilizer distributed in the form of Source: Based on FAOSTAT granules of raw materials such as nitrogen, phosphoric acid, and Fertilizer fertilizer raw materials. While global fertilizer Fig. 2. Rock phosphate production (2016) Fig. 3. Production of potassium chloride (2016) potassium themselves, as opposed to chemical fertilizer in which manufacturers consumption is increasing from year to year each granule contains a mixture of such raw materials Trading Wholesalers together with growing populations and other Jordan companies factors (Fig. 1), fertilizer raw materials such as 3％ Other 17％ Other Canada rock phosphate and potassium are distributed 25％ 26％ China unevenly around the world (Fig. 2, Fig. 3). To 53％ Russia U.S. secure stable supplies of these raw materials, 11％ China Russia 4％ 16％ 17％ it is vital to maintain and strengthen ties with Morocco 12％ Belarus overseas mines. 16％ Japan depends on imports from overseas Source: Based on Ministry of Agriculture, Source: Based on Ministry of Agriculture, ZEN-NOH’s initiatives for much of its feed raw materials as well. Corn Forestry and Fisheries data Forestry and Fisheries data makes up about one-half of compound feed raw Fig. 4. Trends in demand for U.S.-produced corn Fig. 5. Trends in corn exports by country materials. As much of the corn produced in the (Millions t) Feed U.S. China Argentina Brazil 400 ■ Efforts to secure stable supplies U.S., a major exporter, is consumed to use in Food products, seeds, industrial Ukraine Other U.S. share (%) (not including ethanol) ethanol production, exports are increasing from 350 Ethanol Exports （百万トン）（%） of fertilizer raw materials 180 80 new origins such as Brazil and Argentina. (Fig. 300 160 70 4, Fig. 5) To secure stable supplies of corn, it is ZEN-NOH is building ties with overseas mines through transactions conducted Wengfu & Zijin Chemical Industry Co., Ltd., a producer of ammonium 250 140 phosphate in which ZEN-NOH has invested (Fujian Province, China) essential to procure from diversified sources, 60 over the years, in order to secure stable supplies of fertilizer materials. We 120 including these countries. 200 also have invested in Wengfu & Zijin Chemical Industry Co., Ltd., a company 50 100 established in 2012 to produce ammonium phosphate in Fujian Province, China, 150 80 40 to realize stable supplies of high-quality ammonium phosphate. 100 60 30 In addition, the supply of large-granule ammonium sulfate, a vital nitrogenous 40 50 20 fertilizer, remains tight due to plant closures and other factors. In 2018, ZEN- 20 NOH established Nippon Ryuan Service G.K. in the city of Ube, Yamaguchi 0 0 10 Prefecture, as a joint venture with Ube Industries, Ltd. to store and ship large- 17/18 11/12 10/11 16/17 14/15 13/14 15/16 18/19 12/13 07/08 97/98 19/20 90/91 01/02 91/92 09/10 00/01 06/07 96/97 99/00 04/05 03/04 94/95 93/94 05/06 95/96 08/09 98/99 02/03 92/93 2000200120022003200420052006200720082009201020112012201320142015201620172018 granule ammonium sulfate, as part of our efforts to secure a stable supply of Source: Based on U.S. Department of Agriculture data Large-granule ammonium sulfate shipped from Nippon Ryuan Service G.K., a joint high-quality large-granule ammonium sulfate. venture between ZEN-NOH and Ube Industries, Ltd. (Ube, Yamaguchi Prefecture) ■ Production material costs as a share Fig. 2. Feed costs as a share of management costs of the cost of agricultural production ■ New joint purchasing Topic Cattle breeding JA-CAT agricultural materials shops (calves born) 40％ initiatives Costs of agricultural equipment account for Fig. 1. Rice production costs (2017 production) operated jointly with JAs about 20% of rice production costs, while costs Cattle raised ％ In 2018, new joint purchasing initiatives that ZEN-NOH is opening agricultural materials of fertilizer account for about 8% and those of 32 Agricultural began in spring 2017 centralized purchasing shops operated jointly with JAs. The first of agrochemicals for about 7%. (Fig. 1) equipment on 25 brands of general-purpose chemical these shops, JA-CAT Tsuyama, opened in Feed costs as a share of livestock production costs Raw milk 45％ Labor costs 22％ fertilizers from the roughly 550 available. March 2017 under joint operation with JA costs, while varying by type of livestock, are high 31％ Fertilizer In autumn 2018, 30,000 t of fertilizer was Tsuyama (in the city of Tsuyama, Okayama costs at roughly 30-60%. (Fig. 2) Swine raised 62％ contracted for, and in spring 2019 83,000 Prefecture). JA-CAT Kagamino opened in the 8％ same JA’s service area in March 2019. ZEN- For producers, procuring stable supplies of t, a figure much higher than in the previous these production materials at costs as low as Other production NOH will strive to improve members services material costs Rent Broilers 63％ year, was added. Bidding is conducted for Agrichemical and increases their satisfaction even further in possible is an important management point. 22％ 11％ costs Poultry accumulated contracted volumes, and the the future, as it opens more JA-CAT shops. 7％ Egg farming 63％ fertilizers are purchased from the manufacturer * CAT stands for "Communication JA-CAT Tsuyama, jointly operated Source: Based on Ministry of Agriculture, Forestry and Fisheries, plaza with Agricultural Tools." by JA and ZEN-NOH "Statistical Survey of Agricultural Management (Individual bidding the lowest price. Management)." Source: Based on Ministry of Agriculture, Forestry * The total will not necessarily equal 100% due to rounding error. and Fisheries data 34 35 ZEN-NOH’s businesses Production materials business

Agrochemicals business Agricultural machinery business

ZEN-NOH’s role The JA Group's main agrochemicals distribution channels ZEN-NOH’s role The JA Group's main agricultural machinery distribution channels

ZEN-NOH In the agrochemicals business, ZEN-NOH has ZEN-NOH In the agricultural machinery business, ZEN-NOH and and been supplying agrochemicals to producers through supplies producers with agricultural machinery sourced from JA JA KEIZAIREN and JAs and also has been co- JA manufacturers or manufacturer-affiliated sales companies, Agrochemicals KEIZAIREN Agrochemicals KEIZAIREN developing new agrochemicals with Agrochemical JA Producers through JA KEIZAIREN and JAs. JA Producers companies. manufacturers In addition to the tractors, rice planters, and combines manufacturers For the safety use of agrochemicals by producers, essential to agricultural production, we also handle a wide ZEN-NOH is making a strong effort to encourage range of other machinery including machinery used in Manufacturer- appropriate applications under good manner for both Wholesalers vegetable farming, drying and preparation machinery, and afﬁ liated sales people and environment, making application records machinery used in farm work. companies and expanding to use protective gear for safety. ZEN-NOH’s initiatives ZEN-NOH’s initiatives ■ Expanded sales of special standards for direct shipment of agrochemicals to large-scale farmers ■ Joint procurement of large-scale tractors ■ Development of new agrochemicals In 2014, we began sales under special reflecting the views of farmers standards for direct shipment to users (for 4-20 ha), even larger than the large- To reduce the costs of agricultural machinery, we are promoting joint procurement of large- ZEN-NOH has been developing new agrochemicals scale standards (for 1 ha), to large-scale scale tractors (60-hp class). required for Japanese agriculture in cooperation with producers. These enable sale at prices Ordinary Large-scale By focusing on the necessary functions based on seeking the views of more than 10,000 agrochemical companies. standards (1 kg): standards (10 kg): roughly 20-30% lower than under ordinary suitable for 10 a suitable for 1 ha producers and bidding utilizing the advantages of scale backed by enlisting the cooperation In September 2018, ZEN-NOH got registration of standards (for 10 a), through means including of producers nationwide, we have realized price reductions of roughly 20-30% compared to Pyraxalt®, new insecticide highly effective for Plant hopper production to order and direct shipment from standard models in the same class. for rice developing with DuPont Production Agriscience K.K. manufacturers, in addition to benefits of In FY2018, we shipped 853 units, much higher than the target of 597 units. We plan to The products containing Pyraxalt® was launched in scale. Our supply performance is increasing implement joint procurement of mid-sized tractors in the future. 2019. year by year, and we will continue to promote * Plant hopper: one of the most Special standards for direct shipment concerned insect pests of rice the spread of these standards in the future. (40 kg): suitable for 4 ha especially in Western Japan and ■ Shared leasing of agricultural machinery Farmer A the Kanto region. ■ Development of wide-area logistics facilities (joint use of large combines) ■ Development of To lower the costs of agricultural machinery, we are advancing a shift from private To build efficient logistics systems, we are making progress on ownership to joint use. Farmer D Farmer B Generic agrochemicals the development of wide-area logistics facilities serving areas across In shared leasing of agricultural machinery, a team of four producers with differing prefectural boundaries. We opened the Northern Kyushu Wide-Area harvest times use a single combine. ZEN-NOH has developed and promoted two Generic Distribution Center in 2012 and the Chugoku-Shikoku Wide-Area In FY2018, this approach was employed by 75 farms in 27 teams, cutting costs by agrochemicals to contribute cost reduction. Distribution Center in 2018. These facilities' centralized activities include roughly 20% compared to purchase of the machinery. Farmer C In 1995, Penncozeb (Fungicide) was launched as the bulk ordering from manufacturers, bulk first Generic agrochemicals in Japan, moreover J-Ace shipping from manufacturers' plants, (Insecticide) was introduced in 2003 as the second Generic integrated management of inventories, and ■ Development of agrochemicals. aggregating products by shipment destination In April 2018, we established ZM Crop Protection and packing them for individual farmers. wide-area parts centers Corporation., a joint venture with Mitsubishi Corporation for Using agricultural machinery for a longer time helps to reduce the main purpose of maintain the registration and manage of ■ Integrated pest management (IPM) initiatives production costs. For this reason, we are opening wide-area production for ZEN-NOH’s products. parts centers nationwide, serving territories that cross prefectural In response to the issue of resistance to boundaries, to enable swift machinery repairs and improvements. chemicals, we are promoting use of “Banker The Tohoku Wide-Area Parts Center, which began operation in Sheet®” technology that does not rely solely on January 2019, will strive to improve services through increasing its agrochemicals. rate of immediate delivery by enhancing the items in its inventory, * Banker Sheet® technology uses packs containing natural enemies enabling next-morning delivery through nighttime shipments, and of pests to protect the natural enemies from the effects of changes in adopting an ordering system linked to a parts-search function, among temperature and humidity, irrigation, and dispersion of agrochemicals. * IPM: Integrated pest management other efforts. 36 37 ZEN-NOH’s businesses Production materials business

Farming and packaging materials business Feed business

ZEN-NOH’s role ZEN-NOH’s role The JA Group's main compound feed distribution channels Raw materials Compound feed

The materials businesses, which handle various materials needed in processes from cultivation through shipping, is divided into the segments The feed business procures raw ZEN-NOH Regional Grain of farming and packaging materials. feed materials from overseas grain- feed companies JA The farming materials business supplies materials such as steel materials and covering materials mainly for greenhouse use, materials for producing regions and domestic Overseas ZEN- agricultural KEIZAIREN Producers related equipment, and seedling materials. The packaging materials business supplies materials such as cardboard boxes and paper rice bags raw-materials makers and supplies NOH cooperatives Cooperating and JAs used to transport the produce harvested by farmers. It also handles the cardboard materials from which cardboard boxes are made. compound feed produced at the feed Domestic plants plants of Group member companies to raw-materials producers through JA KEIZAIREN and makers JAs. ZEN-NOH’s initiatives ZEN-NOH’s initiatives ■ Expanding promotion of biodegradable mulch ■ Efforts to secure a stable supply of

Considerable attention has been focusing in recent years on recycling of compound feed raw materials ZEN-NOH Grain (U.S.)

plastics. Waste plastics produced in the ﬁ eld of agriculture include covering In use for green soybeans materials for greenhouses and tunnels, mulch, and other materials. ZEN- To secure a stable supply of compound feed raw materials, ZEN-NOH established ZEN-NOH Grain NOH cooperates with the industry and related agencies in promoting waste Corporation in 1979 in New Orleans, Louisiana, in the U.S. It operates grain storage and loading facilities. reduction through proper collection and recycling of waste plastics. We also have established CGB Enterprises, Inc. as a joint venture with Itochu Corporation to handle ZEN-NOH handles biodegradable mulch products centered mainly on the origination of materials in grain-producing regions. This has resulted in a complete supply chain from the Corn Mulch II brand made using imported raw materials. Since biodegradable upstream level. Competition for originating grains is intensifying amid growing global demand. In response, mulch breaks down in the ﬁ eld soil after use, it generates no waste plastics ZEN-NOH Grain Corporation expanded its export elevator, which then began full-scale operation in April 2018. ALZ (Brazil) and helps reduce the effort required to collect mulch after harvest in large- This has increased its capacity of loading ships for export from 13.5 to 19 million tons per year. scale farming. In Brazil, ZEN-NOH has established Amaggi Louis Dreyfus ZEN-NOH Holdings S. A. (ALZ), a grain originating and exporting company, as a joint venture with a Brazilian grain handlers that has enhanced its grain-

In use for taro procurement structure in that market. In Canada, Grains Connect Canada Operations Inc. (GCC) is a grain originating joint venture established in ■ ZEN-NOH’s original simple 2015 with the Australian grains originating, shipping, and sales company GrainCorp. Furthermore, in December hydroponic cultivation system “With One” 2018 we reached agreement with a Canadian grain company on the establishment of Fraser Grain Terminal Ltd. (FGT) to operate an export facility. GCC (Canada) “With One” is a hydroponic cultivation system that Seedling period (winter-spring) Period of use (summer-winter) bundles together supplies such as polystyrene foam planters and irrigation equipment. It helps to improve ■ Supplying non-genetically ■ Streamlining of the compound feed producers' disposable income through means such as modifi ed corn production and supply structure putting unused greenhouses to effective use and utilizing rice seedling greenhouses in the off season. Since its In the U.S., a major production area of corn, which is the main JA Nishi-Nihon Cooperative Feed & introduction in FY2013, its use has spread centered on the raw material in livestock feed, genetically modifi ed organism (GMO) Mills Co., Ltd., which manufactures and Tohoku region, and as of the end of March 2019 it was in seeds have increased their share of planted crops to 92% (as of sells compound feed to the Western Japan use in cultivating approximately 11 ha on 163 farms. 2018). In response to the needs of consumers such as consumers’ region (Kinki, Chugoku-Shikoku), has cooperatives, the ZEN-NOH Group uses identity-preserved (IP) streamlined its supply structure through handling from producing area to livestock farmers in Japan, to consolidation of three former mills at the The Kurashiki Mill of JA Nishi- Nihon Cooperative Feed & Mills Co., ■ Standardization on national-standard cardboard boxes supply feeds made using non-genetically modifi ed corn that is not newly constructed Kurashiki Mill (which Ltd. treated with chemicals post-harvest (PHF/NON-GMO). began operation in June 2017). In addition, Hokuren Cooperative Feed ZEN-NOH is advancing standardization on national-standard cardboard boxes for three types Mills Co., Ltd. plans to develop an effi cient of vegetables: onions, taro, and bell peppers. By the end of FY2019, this is expected to result in a * PHF (Post Harvest Free): avoiding use of chemicals to maintain quality after harvesting supply structure in Hokkaido by establishing reduction of approximately 30% in the number of box standards used for these three vegetables, * Non-GMO: non-genetically modifi ed a joint venture specializing in production which had stood at 1,300 standards. Similar efforts began in FY2018 for carrots and white potatoes. organisms of compound feed under contract, with Through these initiatives, we will promote use of pallets in shipping of agricultural produce, by Hokuren Cooperative Feed Mills Snow Brand Seed Co., Ltd. (Plans call for Co., Ltd. will establish a feed- advancing standardization on cardboard-box standards designed with pallet sizes in mind. Grain farmer members organized by production joint venture with Snow CGB implement an IP handling program operation to begin in December 2021.) Brand Seed Co., Ltd. 38 39 ZEN-NOH’s businesses

Energy business Life support business

ZEN-NOH’s role ZEN-NOH’s role

The energy business delivers stable supplies of the energy (electricity, The life support business supplies the products and services that rural residents need in their daily lives. In addition to operating A-Coop petroleum, LP gas) needed for rural living and farming. stores, ZEN-NOH also is deploying a wide range of other related business, such as JA-Kurashi-no-Takuhaibin, which lets users order products The electricity business engages in retail sales of electricity under the JA for everyday life on the Internet, joint purchase using reserved orders, grocery delivery and buyer's clubs that deliver groceries and other items to Denki brand name. It purchases electricity from power-generating companies homes periodically, a funeral business to provide support for members' funerals, and a home medical supplies business. and strives to enhance its supply infrastructure. The petroleum business supplies gasoline, fuel oil, and other fuels through JA-SS service stations. It sources these from suppliers in Japan and around the world and distributes them through ZEN-NOH Group petroleum facilities and ZEN-NOH’s initiatives other facilities. The gas business supplies LP gas under the brand name Kumiai Propane. In addition to domestic supplies, it also imports LP gas directly from producer states in the Middle East. ■ Farm-stay efforts, to revitalize regions by connecting urban and rural communities

As a measure to stimulate rural communities by attracting consumption (demand) from ZEN-NOH’s initiatives Topic Home electricity supply begins urban communities and elsewhere, ZEN-NOH aims to develop new businesses in lifestyle- related ﬁ elds, including farm-stay service that includes use of vacant homes in rural areas as To cut members' agricultural and home energy costs, we entered well as supply of related materials and equipment. For this reason, we are working on efforts ■ Maintenance and enhancement the electricity diagnostics and retail business and began supplying including support for startup of farm-stay businesses and development of a portal site where electricity to JA Group facilities and agricultural facilities in 2016. users can make reservations for farming experiences and accommodations. of lifeline functions After having realized a switchover to these services to a certain degree and developed the related supply infrastructure, in December Supplies of petroleum and LP gas from the JA Group serve as a 2018 we began rolling out steadily home electricity supply for ■ A-Coop Topic members. Currently, we are negotiating with individual JAs to enable JA Farmers lifeline for farmers, members, and residents of rural communities. the swift nationwide deployment of this service. A-Coop Tohoku ZEN-NOH and A-Coop consider A-Coop The petroleum business is striving to improve the efficiency In addition, since the feed-in tariff (FIT) program under which A-Coop is an organization of 47 stores Service area : Aomori, Iwate, Miyagi, of distribution through revising its area strategies as appropriate Akita, Yamagata supermarkets to be not just key facilities electricity generated by home solar panels is purchased at fixed JA Group companies operating Hokuren Shoji 62 (including consolidation and closure of service stations and shifting JA Life Toyama Service area : stores in members’ daily lives but also bases for prices will be discontinued gradually beginning in November 2019, A-Coop supermarkets 4 Hokkaido stores Service area : sale of domestic agricultural and livestock to wider-area distribution facilities) as well as promoting use of self- we will promote purchase of electricity from members' households across Japan. Through all 13 Toyama products. JA Farmers stores, in which service stations, to ensure stable fuel supplies over the medium to and use of storage cells. members working together, 16 Jacom Ishikawa stores Service area : Nagano A-Coop 27 A-Coop supermarkets include direct-sales long term. it aims to enhance product Ishikawa Service area : Nagano stores facilities for agricultural produce opened The gas business is enhancing its promotion of non-use procurement and management 69 A-Coop Nishi-Nihon A-Coop Kanto in cooperation with local JAs, are opening stores Service area : 30 Service area : stores notiﬁ cation services for elderly people who live alone (services that capabilities on a nationwide Shimane, steadily across Japan, reaching a number of Gunma, Saitama, Okayama, Tokyo, Kanagawa 21 stores. (As of July 31, 2019) notify relatives or others if LP gas has not been used for 24 hours or scale. Hiroshima, Ehime longer) and bathroom heaters/dryers as a measure to combat heat A-Coop Aichi 22 stroke. Service area : Aichi stores A-Coop Kinki 37 Service area : Mie, Kyoto, Osaka, Hyogo, Nara, Wakayama (part) stores A-Coop Kyushu 51 Service area : stores ■ Deploying the home energy business Fukuoka, Saga, Oita JA Okinawa A-Coop A-Coop Miyazaki 39 19 Service area : Miyazaki stores stores Service area : Okinawa A-Coop Kagoshima 70 ZEN-NOH strives to help members Service area : Kagoshima stores (As of July 31, 2019) lower their home energy costs, by Farming facility Purchase of surplus power developing a new menu of options that JA facility adds electricity to our petroleum and LP Member's household Kumiai Propane ■ JA-Kurashi-no-Takuhaibin gas services. ・ Kitchen Hot Heating Lighting Electricity, fuel fuel oil Furthermore, we also are making water Equipment JA-Kurashi-no-Takuhaibin is a service that lets members and users order products on the Internet for progress on developing home energy Energy-saving solutions delivery directly to their homes. It not only greatly shortens the lead time from when an order is placed to its New technologies supply models that combine various new delivery but also can help reduce inventory at JAs, simplify shipping, and enable a choice of payment methods ●Solar ●Storage (such as credit card or COD), compared to traditional joint-purchasing methods. The product range contains energy-saving technologies (such as solar ●V2H ●Fuel cells power, storage cells, V2H, and fuel cells) power cells about 1,000 items, from 257 JAs in 31 prefectures (as of March 31, 2019). with various heat sources. In the future, we plan to cooperate with other businesses to make it even more convenient for members and ※ V2H：Vehicle to Home Efforts to put electricity stored in electric vehicles to effective use in the home users. 40 41 ZEN-NOH’s businesses Disaster recovery and restoration We work together with government and other parties to assist in recovery and restoration from successive natural disasters, which have caused massive damage to agricultural production in recent years to do efforts in response to the needs in affected Facilities and agricultural residential business areas. In the Tohoku region, where improvements are underway to agricultural infrastructure, including farmland and agricultural facilities, damaged by disaster, we are advancing efforts in areas such as adoption of advanced technologies, sales support based on related needs, enhancing system for providing agribusiness guidance, and promoting sales of agricultural and livestock products The facilities and agricultural residential businesses support construction, by acting on the client’s behalf, of the grain drying and from the region to establish a new agricultural structure through agricultural corporations. preparation facilities, fruit and vegetable collection and shipping facilities, cattle barns, meat processing facilities, warehouses, shops selling agricultural products directly, stores, and other facilities needed by JAs and other organizations to deliver producers' agricultural and livestock produce to consumers as well as residential housing and other properties intended to manage members' assets and put their land to effective use. Under contract to members, JAs, and other clients, these businesses offer a system that supports activities from building planning through design, construction management, inspection, and delivery, all on behalf of the client. ■ Support for recovery from the Great East Japan Earthquake Corporation with JA investment: Yamamoto Farm Miraino, K.K.

The tsunami caused by the Great East Japan Earthquake brought devastating damage to the town of Yamamoto in southeastern Miyagi Prefecture. Yamamoto Farm Miraino, K.K., an agricultural production Facilities business Yamamoto corporation, was established in July 2015 aiming to resume farming in this district with the support of Farm Miraino, K.K. Agricultural facilities such as fruit and vegetable collection and shipping facilities require not only functions for uniform processing of the JA Group (JA Miyagi Watari, ZEN-NOH, the Norinchukin Bank, and others). Aiming to build a large- large volumes of produce but also the abilities to save labor and improve effi ciency with regard to plant equipment, in light of the shortage sale management model based on proper land use, this cooperation is growing vegetables (such as leeks, ：Completely destroyed of labor and other factors, as well as reducing renovation, maintenance, and repair costs of aged facilities. To respond appropriately to onions, sweet potatoes, and carrots) through ground farming, with ZEN- NOH providing support in the ：Half damaged such diversifying needs, in FY2014 ZEN-NOH established the plant construction manager qualifi cation system, intended to train and further areas of cultivation techniques, varieties, adoption of integrated mechanization systems, and sales. In ：Partially damaged improve the skills of those who implement March 2018, it, along with two other corporations in the prefecture, earned Global GAP certifi cation (for and support planning, decisions on scale, tomatoes) under the JA Group Good Agricultural Practice (GAP) Third-party Certifi cation Support Program. basic design, selection of contractors, and Tsunami damage in Yamamoto construction management, from the client's perspective. At present, 22 people have earned the class-I qualifi cation and 59 have ■ Tohoku-Miyagi Revive Marathon ■ The ZEN-NOH Tohoku Project earned the class-II qualification. All are working energetically at construction sites ZEN-NOH and its Group companies sponsor the Tohoku-Miyagi Revive Since FY2015, ZEN-NOH has carried out the ZEN- across Japan. Marathon, held in the coastal region of southern Miyagi Prefecture (since NOH Tohoku Project, aiming to enhance sales of 2017). We supported agricultural and livestock products and processed Grain drying and preparation facility Fruit and vegetable collection and shipping facility operation of the products from the six prefectures of the Tohoku region. Tohoku-Miyagi Revive ZEN-NOH Tohoku Project sales booths are being set Marathon 2018, held in up at various events, we are cosponsoring the Tohoku Agricultural residential business October 2018, through Sosei Genki Project, organized by seven newspapers in means including giving the Tohoku region, and we publicize Tohoku agricultural Centered on staff who possess professional participants tomatoes and livestock products at various events, among other qualifications, such as real-estate brokers*, this business grown in Miyagi activities. helps members manage their assets and utilize their land Prefecture as well as We also are developing the Tohoku Wagyu beef effectively, through asset-management consulting services rice balls made from brand and commercializing samplers of famed rice for members mainly in cooperation with JAs in the greater prefecture rice. varieties from the six Tohoku prefectures. Tokyo area. In construction of rental housing, single-family homes, and other projects, it acts on the client's behalf from inspection of construction through delivery of the fi nished Premium retirement homes with long-term care Retail facilities ■ Sponsoring the JA Youth Kizuna Project project. It also handles renovation and other activities. * 52 people (As of July 2019) Ever since the Great East Japan Earthquake in 2011, JA Youth (JA Youth Division, Prefectural Federations of JA Youth Organizations, National Federation of JA Youth Organizations) has carried out the JA Youth Kizuna * Tohoku Wagyu is a wagyu beef brand under Project. This Project’s activities have included providing A-Coop wet wipes which calves born at Design business the Fujisawa ranch for sale by individual youth organizations, operated directly by JA At present, ZEN-Noh includes 172 class-I architects and 39 class-II architects, who design with part of the proceeds from such sales ZEN-NOH Kita-Nihon Cooperative Feed & Mills a wide range of buildings ranging from agriculture facilities to general buildings such as offi ces, being donated to youth organizations in Co., Ltd. and fattened in Tohoku are marketed. chiefly in the facilities business. In addition to basic planning to work out building structures prefectures affected by disasters such as The concept behind this brand is a focus on with clients and preparation of execution drawings, their wide range of activities also includes the torrential downpours in Western Japan red meat that balances preparation of various applications submitted to the authorities and others, estimating volumes in 2018, typhoons, and earthquakes. the taste and texture of wagyu. of building materials to be used and design costs, and creating perspective drawings that give Perspective drawing ZEN-NOH supports this initiative by clients an idea of what the completed building will look like. In design of agricultural facilities in supplying A-Coop wet wipes. particular, since ZEN-NOH has expertise on the plant equipment installed inside the buildings its specialized knowledge enables design of facilities that can be used smoothly, helping to support JAs nationwide. Construction plans 42 43 SR activities ZEN-NOH Cup All-Japan Table JA ZEN-NOH WCBF youth baseball lessons Social Responsibility Activities Social Responsibility Tennis Championship Tournament ZEN-NOH is a special sponsor of these lessons, organized by the (Hopes Cub Bambi Division) World Children's Baseball Foundation (WCBF), which is chaired by As an active member of local communities, ZEN-NOH employs a proactive approach to social responsibility. Covering a wide range of Sadaharu Oh. Instructors are former professional baseball players in areas from food and agricultural education through sports and the environment, these activities contribute to building the future of our Japan, including Oh himself. communities. They include not only support for professional and amateur sports, but also activities to deepen education on food and agriculture for children, who will form the Japanese society of the future, and welfare and cultural activities.

■ Supporting sport Supporting the activities of athletes by providing them with Japanese foods.

Table tennis All-Japan Table Tennis Championship Tournament (Cadet Division) As an official sponsor of the Japan National Table Tennis Team, in addition to sponsoring tournaments held in Japan and publicizing Nutrition education project for domestic agricultural and livestock products through provision of additional prizes and food samples, ZEN-NOH also supplies Japanese foods to players taking part in international tournaments and supports them. Table- tennis player Kasumi Ishikawa, under contract to ZEN-NOH, won high-school baseball players the silver medal in the mixed double's event in the World Table Together with Ritsumeikan University, ZEN-NOH is carrying out a Tennis Championships in April 2019 (held in Budapest, Hungary). joint nutrition education project for high-school baseball players over the three-year period 2018-2020. This project aims to develop nutrition education programs for high-school baseball players and other athletes ZEN-NOH/“Hagitomo” swimming lessons by supplying rice to four schools partnering in the study and researching Taught by former Japan National Team competitive swimmer the advantages of a diet centered on rice as well as cooperating with Tomoko Hagiwara, who competed in the Sydney Olympics, these local JAs in activities to contribute to the community. swimming lessons are intended to teach the joy and importance of a good diet through sports.

Photo courtesy: Nittaku News

Curling

As an ofﬁ cial sponsor of the Japan National Curling Team, ZEN- NOH sponsors tournaments held in Japan including the ZEN-NOH Japan Curling Championships and the ZEN-NOH Japan Mixed ■ Food and agricultural education Doubles Curling Championships as well as providing additional prizes and food samples. Furthermore, together with providing "Nippon no Shoku" Japanese Rice Paddy Organism Survey ZEN-NOH parent-child cooking classes foods to Japanese athletes participating in international tournaments held overseas, we also provide meals at their tournament venues to ZEN-NOH is carrying out the Rice ZEN-NOH Minna no Kodomo cooking classes support the activities of the Japan National Team worldwide. Paddy Organism Survey in conjunction ZEN-NOH hosts parent-child cooking classes using fresh with JAs, producers, consumers, and domestic farm products and cooking classes in which children children nationwide, arranging activities to with disabilities participate, in cooperation with various ZEN- ZEN-NOH Chibi-lympics: Spring Chibi-lympics ZEN-NOH Cup Japan Elementary enable participants to learn, through the NOH Group companies. This program allows children to take five senses, about the deep connection on the challenge of preparing a bento box lunch without School Curling Championships between the environment and farming and ZEN-NOH is a special sponsor of the ZEN- relying on their parents, to enhance their understanding of the importance of conserving biodiversity. NOH Chibi-lympics, held every year on May 5, Winter Chibi-lympics and interest in the importance of food and food ingredients. Implemented: Children's Day. Held at Nissan Stadium in the city In these classes, employees of ZEN-NOH Group companies 78times Total participants: of Yokohama and other venues, the ZEN-NOH Curling teams of elementary-school students compete Implemented: and ZEN-NOH itself deliver classes on Japanese agriculture 2,404 Chibi-lympics on May 5, 2019 featured the best for the national championship in the ZEN-NOH Chibi- 604times and ingredients along with food quizzes, communicating to Total participants: (2006–2019) efforts of 4,900 young athletes in front of 22,000 lympics ZEN-NOH Cup Japan Elementary School Curling participants the importance of agriculture and food. 29,403 spectators. Championships. This tournament was held for the ﬁ rst time in December 2018, featuring thrilling competition among young (2008–2019) athletes from across the country. ZEN-NOH parent-child agricultural experience tours

These tours are organized with the cooperation of Implemented: JAs to provide consumers who are generally unfamiliar 65times with agricultural practices with an opportunity to interact Total participants: with producers by experiencing farm work, including 2,392 planting and harvesting vegetables, ﬂ owers, and rice, so (2005–2019) that they can have a better understanding of agriculture. 44 45 JA Group Organization and Businesses ZEN-NOH’s organizational structure

JAs are organizations that conduct business Structure of the JA Group activities through the participation and collective 1. JA Group Organizational Chart (economic activities) efforts of their members. They collectively purchase Marketing and Supply Business the materials necessary for agricultural production and Supervisory Business In addition to handling the The marketing side delivers the agricultural market agricultural products under the provisions of the guidance, auditing, and education and livestock products produced by members (as of the end of FY2017) Agricultural Cooperative Association Act. They are also of JAs, these businesses deal to consumers, while the supply side provides Total membership: 10.51 million mainly with agricultural policy members with the materials they need. involved in a wide range of business activities including issues and public relations. nal level Natio those that provide members with products necessary Municipal level JAs〈600〉 for daily life; savings accounts and credit services such tural level es fec JA as loans; and mutual insurance services that offer life, tiv Pre ra Pr Z ZEN-NOH e efect E op J ura property, and car insurance. o As-le l N 〈32 prefectural headquarters〉〈7〉 U C vel - JAs (prefectural JAs) H ral JA N 〈8〉 u al level s JA KEIZAIREN C t icip O Aomori, Iwate, Miyagi, Akita, Yamagata, Nara, Shimane, Yamaguchi, Kagawa, Prefectural-level federations and central unions as well ul n s un N ic io e M H r I n iv Hokuren, Shizuoka, Aichi, Fukui, E g A U t Prefectural Fukushima, Ibaraki, Tochigi, Gunma, Saitama, l ra P Kochi, Saga, Okinawa as the national-level federation ensure that the business Z A K a e of re J f r p fec o t A A O n o g Chiba, Tokyo, Kanagawa, Yamanashi, Nagano, Wakayama,Kumamoto, Miyazaki, o tu A n e ri r K C c al level o U C activities of Jas are conducted efﬁciently. The entire JA i l u E J l E n a lt H a u c I Niigata, Toyama, Ishikawa, Gifu, Mie, Shiga, Kyoto, Kagoshima r r o Z U u r C u a n l t t o A l l a m organization is known as the JA Group. It consists of three c u C I r e o i Osaka, Hyogo, Tottori, Okayama, Hiroshima, c c R f i o r F nt e p E e e r g e d r N C P A a e Tokushima, Ehime, Fukuoka, Nagasaki, Oita r levels: JAs; prefectural-level JA federations and CHUOKAI ti f at e v o e io h Members:

n (Prefectural Central Union of Agricultural Cooperatives) T ZEN-NOH membership（945）(as of March 31, 2019)

million ry Full members Combined JA (626), specialized JA (73), JA KEIZAIREN (8), specialized federations (26), credit federations/ organizations; and the national JA federation. 10.51 t k s

(as of the end of FY2017) re welfare federations (49), national federations (3) n （ 7 8 5 ）… o F Z a d ● 6 B n 〈〉 ’ E ) National level Headquarters Network affiliate companies (153), consumer cooperatives (Futaba Seikyo, Co-op Kobe, Co-op Yamaguchi) (3), What is ZEN-NOH s role? 0 a 9 n 7 o Secondary members 1 N i s N t re A 0 e N I u fisheries cooperatives (Awashimaura Fisheries Cooperative, Mie Gaiwan Fisheries Cooperative) (2), forestry cooperative g 2 E ra v K e ti lt The ZEN-NOH Group is responsible for the marketing and r y a i l R d r K u （16 0）… c e c Y u F e (Kyoto Forestry Association) (1), tobacco growers’ association (West Japan Tobacco Growers’ Association) (1) u J N p ri l I it o U supply business of the JA Group, including sale of agricultural O tu f d o g r o H e C H A a s r l r R l JA a S C a C s ( l r C o products and supply of materials for use in agricultural production. E oo n ra u f pe tio A tu lt N k rativ ocia J c cu I n N e Ass e ri a * Numbers of JAs and prefectural JAs are current as of July 2019 ref g B It cooperates with JAs, who are members of the ZEN-NOH Group, P f A R o ve O ti and prefectural federations to create scale advantages in carrying Ot l- N ra her prefectura e E p leve ns H oo out competitive marketing and supply activities. These activities l federatio T C tral en support increases in members’ farm incomes and expansion of C Credit Business Ot s her n ation their agricultural production capacity. ZEN-NOH’s role is to supply ational-level feder This business provides Mutual food products to consumers across Japan through such activities. various financial services (as of July 31, 2019) Insurance Business for members, funded by 2. ZEN-NOH Organizational Chart Our insurance business the savings of members. ● JA KEIZAIREN and prefectural JAs supports the livelihoods of Other Businesses members, offering mutual Other businesses include the public welfare business, newspaper Among JA federations, JA KEIZAIREN do business in their life insurance, mutual information business, publishing and cultural program business, and prefectures, while national federations, including ZEN-NOH, do non-life insurance, and tourism business (Japan Agricultural News, Ie-No-Hikari Association, Meeting of Delegates (quorum of 230) business nationwide. mutual pension insurance. Nokyo Tourist Corporation, JA ZENKOREN, JA KOSEIREN) (General meeting to make decisions on dissolution, succession, merger, new subdivisions, and organizational changes) Previously, JA KEIZAIREN in each prefecture handled economic activities such as sale of agricultural and livestock produce under JA KEIZAIREN Hokuren, Shizuoka, Aichi, Fukui, Wakayama, Kumamoto, contract and handling of production materials, but these were (8 organizations) Miyazaki, Kagoshima consolidated into eight organizations under organizational reforms, Prefectural-level and other KEIZAIREN were merged with ZEN-NOH successively Nara, Shimane, Yamaguchi, Kagawa, Kochi*, Saga*, Okinawa Supervisory Board (quorum of 20) JAs (7 organizations) (quorum of 5-7) beginning in 1998, so that as of April 2019 ZENNOH included 32 Board of Auditors 20 members of Supervisory Board prefectural headquarters. *The JAs in Saga Prefecture have succeeded the economic federation comprehensively. In addition to Saga 6 auditors (of whom 3 are outside auditors) (of whom 1 is the Chairman, 2 are Vice Chairmen, JA regional consolidation across multiple municipalities also Agricultural cooperatives, which serve the entire prefecture, there are three other JAs in Saga: JA Karatsu, JA and 5 are outside members) Imari, and JA Saga City Chuo. is underway, leading to the birth of seven prefectural JAs in which * There are four JAs in Kochi Prefecture: JA Kochi Prefecture, formed through the consolidation of 12 JAs in the JAs succeed the activities of the JA KEIZAIREN. prefecture along with their federation function, as well as JA Tosa Kuroshio, JA Umaji Village, and JA Kochi City. Auditor’s Office Board of Directors (quorum of 9-11) President & CEO (1) ZEN-NOH Profile Senior Executive Vice Presidents (2) Internal Audit Division Farm Produce Division Executive Vice Presidents (7) (Wheat, Barley, Soybean & Starch) ● History of consolidation between ZEN-NOH and the economic federations Corporate Planning Division Established Membership Finance Division Fresh Produce Division (Vegetable & Fruit) ● How are the 230 members of the 945 cooperative 1998 October Three federations: Miyagi, Tottori, and Shimane Production Materials Business Division March 30, 1972 Legal & Risk Management Division Meeting of Delegates chosen? unions (including 160 2000 April Three federations: Tokyo, Yamaguchi, and Tokushima Crop Production Division Business goal General Affairs & Personnel Division They are chosen through elections held for secondary unions) 21 federations: Aomori, Yamagata, Shonai, Tochigi, Chiba, Facilities & Asset Management Division individual districts in accordance with the All member cooperative unions work together to Public Relations & Research Division promote ZEN-NOH businesses, thereby increasing Yamanashi, Nagano, Niigata, Toyama, Ishikawa, Gifu, Mie, Livestock Business Division delegate election rules attached to the articles Capitalization 2001 April Subsidiary Group Management Division the production efficiency of the work of member Shiga, Kyoto, Osaka, Hyogo, Okayama, Hiroshima, Kochi, Livestock General Planning Division of association. Candidates must be full members 115.2574 billion yen farmers, improving their economic conditions, and Fukuoka, and Nagasaki IT Promotion Division Livestock Production Division of ZEN-NOH. (The term of office is three years.) contributing to the raising of their status in society. 2002 April Six federations: Iwate, Akita, Ibaraki, Gunma, Saitama, and Oita Sales Development Division Employees Dairy Division ● How are the Chairman and Vice-Chairmen Our businesses, which provide production materials, 7,960 2003 April Two federations: Fukushima and Kanagawa Food Market Division Consumer Business Division of the Supervisory Board chosen? daily necessities, and process and market agricultural 2004 April One federation: Ehime Exports Promotion Division Energy Division Of the members of the Supervisory Board, products, are conducted with this goal in mind. (as of March 31, 2019) Merger of the Yamagata Prefectural Headquarters and the Agribusiness General Planning Division Life Support Division one must serve as the Chairman and two as 2008 April Offices Shonai Headquarters Rice Business Division Prefectural headquarters: 32 prefectures Vice-Chairmen. They are appointed from among Main office: Tokyo In connection with the start of JA Shimane, Aomori, Iwate, Miyagi, Akita, Yamagata, the members of Supervisory Board through a Prefectural headquarters: Aomori, Iwate, Miyagi, 2015 March Rice Production and Procurement resolution of the Supervisory Board. the Shimane Prefectural Headquarters was abolished Planning Division Fukushima, Ibaraki, Tochigi, Gunma, Saitama, Akita, Yamagata, Fukushima, Ibaraki, Tochigi, Gunma, In connection with the start of JA Kochi Prefecture, Chiba, Tokyo, Kanagawa, Yamanashi, Nagano, Saitama, Chiba, Tokyo, Kanagawa, Yamanashi, January Rice Division ● What are the duties of auditors? the Kochi Prefectural Headquarters was abolished Niigata, Toyama, Ishikawa, Gifu, Mie, Shiga, Kyoto, Nagano, Niigata, Toyama, Ishikawa, Gifu, Mie, Shiga, 2019 Auditors audit the performance of duties by In connection with the start of JA Yamaguchi Prefecture, Osaka, Hyogo, Tottori, Okayama, Hiroshima, Kyoto, Osaka, Hyogo, Tottori, Okayama, Hiroshima, April the Supervisory Board and Directors. Tokushima, Ehime, Fukuoka, Nagasaki, Oita the Yamaguchi Prefectural Headquarters was abolished Tokushima, Ehime, Fukuoka, Nagasaki, Oita 46 47 Financial Information

FY2018 Profit and Loss Statement FY2018 Turnover (Unit: 100 million yen) FY2018 Consolidated Profit and Loss Statement Breakdown of Operating (April 1, 2018–March 31, 2019) (Unit: million yen) (April 1, 2018–March 31, 2019) (Unit: million yen) Earnings by Business Segment Business Operation Result Previous year Year-on-year Item Amount Item Amount (April 1, 2018–March 31, 2019) (Unit: million yen) Previous year Year-on-year Rice and grains business total 6,932 7,181 97% Previous year Year-on-year 1. Total operating income 91,272 91,713 100% Pearl Rice 480 466 103% 1. Total operating income 216,259 222,169 97% Business Operation Amount Previous year Year-on-year (1) Operating earnings 4,681,651 4,726,405 99% Rice 5,336 5,610 95% (1) Operating earnings Rice and grains (2) Operating expenses 6,198,586 6,182,405 100% 784,867 804,124 98% 4,590,379 4,634,692 99% Wheat and barley 212 209 101% (2) Operating expenses Fruits and vegetables 2.Business administrative expenses 94,493 92,466 102% Soybean and coleseed 250 259 97% 5,982,326 5,960,235 100% 1,212,800 1,243,150 98% (1) Personnel expenses 58,431 58,309 100% General farming products 654 637 103% 2.Business administrative expenses 204,372 199,695 102% Agribusiness and 870,642 876,367 99% (2) Business expenses 9,537 8,579 111% Fruits and vegetables production materials (1) Personnel expenses 128,524 126,276 102% (3) Office expenses 7,439 7,125 104% business total 11,288 11,643 97% Livestock 2,204,552 2,161,586 102% (4) Taxes and dues (2) Business expenses 18,645 17,998 104% 7,366 6,613 111% Fruits and vegetables 11,223 11,580 97% (5) Equipment/facility expenses Consumer 1,093,736 1,065,237 103% 8,619 8,555 101% Prefecture-level direct sales 64 62 103% (3) Office expenses 11,135 10,624 105% (6) Depreciation expenses 3,100 3,283 94% Other (transportation, etc.) 191,966 191,740 100% Agribusiness and production (4) Taxes and dues 10,683 10,011 107% Operating profit - 3,221 - 753 - 8,054 8,118 99% materials business total Total 6,358,566 6,342,205 100% 3. Non-operating profit or loss (5) Equipment/facility expenses 25,528 24,866 103% 11,376 10,554 108% Sales projects - 1 - Ordinary income Elimination* - 159,979 - 159,800 - 8,154 9,800 83% JA Green 48 50 97% (6) Depreciation expenses 9,543 9,509 100% 4. Extraordinary profit or loss - - Total 2,066 2,019 - Fertilizer 1,918 1,886 102% (7) Other expenses 6,198,586 6,182,405 100% Income before taxes 310 409 76% 6,087 7,780 78% Agrichemicals 1,203 1,196 101% * This indicates inter-segment sales/transfers. Provision for corporate, residential and business taxes Operating profit 11,887 22,474 53% 324 317 102% Production materials 390 369 106% Adjustment to corporate tax, etc. 1,575 2,706 58% Packing materials 149 148 101% 3.Non-operating profit or loss 17,464 12,595 139% Net surplus 4,187 4,756 88% Cardboard products 983 985 100% Ordinary income 29,351 35,069 84% Agricultural machinery 1,277 1,260 101% 4.Extraordinary profit or loss - 1,923 - 59 - Facility and housing 2,085 2,224 94% Turnover by Different Business Operations Income before taxes Livestock business total 10,462 10,485 100% 27,428 35,009 78% F Y2013 Livestock production business Provision for corporate, 8,170 10,541 9,405 11,421 11,314 50,852 1,000 1,177 85% 7,652 7,329 104% Single-ingredient feed residential and business taxes F Y2014 and feed ingredients 3,716 3,479 107% 7,674 11,119 8,268 11,361 10,161 48,584 Adjustment to corporate tax, etc. 4,708 5,319 89% Livestock product sales 1,864 1,907 98% F Y2015 7,140 11,754 8,611 11,116 8,325 46,946 Total corporate tax, etc. 12,361 12,648 98% Dairy farming business 3,099 3,150 98% Livestock sales Income F Y2016 7,123 11,937 8,009 10,729 8,182 45,981 783 772 101% 15,066 22,360 67% Consumer business total 9,190 8,956 103% Income attributable to non-controlling interests 2,150 3,882 55% F Y2017 7,181 11,643 8,118 10,485 8,956 46,382 Automobiles 177 166 107% Net income 12,916 18,478 70% Oil F Y2018 6,932 11,288 8,054 10,462 9,190 45,925 6,194 5,918 105% Gas 858 852 101% Rice and grain production Fruit and vegetables/farm products Total Daily necessities 1,962 2,020 97% Agribusiness/ production materials Livestock Consumer (unit: 100 million yen) Grand total 45,925 46,382 99% *Figures shown are rounded off to the nearest 100 million yen. (as of March 31, 2019) (as of March 31, 2019) FY2018 Consolidated Balance Sheet (Unit: million yen) FY2018 Balance Sheet (Unit: million yen) Assets Amount Previous Change over Liabilities and Member’s Equity Amount Previous Change over Assets Amount Previous Change over Liabilities and Member’s Equity Amount Previous Change over year previous year year previous year year previous year year previous year 1.Current assets 1,186,318 1,246,794 - 60,475 3. Current liabilities 1,018,256 1,075,925 - 57,669 1. Current assets 843,661 875,568 - 31,906 3.Current liabilities 807,689 836,687 - 28,997 (1) Cash and deposits 125,176 150,891 - 25,715 (1) Notes payable 15,089 16,209 - 1,119 Cash 359 352 6 Notes payable 13,178 14,445 - 1,267 (2) Notes receivable 2,201 2,257 - 56 (2) Short-term borrowing 344,527 351,631 - 7,104 Deposits 19,825 41,741 - 21,916 Short-term borrowing 200,442 186,663 13,778 (3) Marketable securities - (3) Accounts payable - Notes receivable 654 662 - 7 Accrued liabilities 529,182 548,765 - 19,582 20,182 21,283 1,101 522,001 546,002 24,001 Marketable securities 19,702 20,798 - 1,095 Unliquidated liabilities 11,267 12,897 - 1,629 (4) Accounts receivable 484,058 492,226 - 8,168 (4) Unliquidated liabilities 11,416 12,951 - 1,535 Accounts receivable 453,467 460,357 - 6,890 Other current liabilities 47,595 67,877 - 20,281 (5) Unliquidated claims 159,862 182,083 - 22,220 (5) Other current liabilities 115,541 139,300 - 23,758 Unliquidated claims 180,629 200,001 - 19,371 Reserve for bonus 4,433 4,501 - 67 (6) Inventories 256,167 246,044 10,123 (6) Reserve for bonus 9,438 9,594 - 155 Inventories 161,070 142,557 18,513 Reserve for losses from gift voucher redemption 1,557 1,508 48 (7) Other current assets 136,937 148,985 - 12,047 (7) Deferred tax liabilities 240 235 4 Other current assets - Reserve for point card certificates 8,712 8,796 83 32 27 4 (8) Deferred tax assets 5,170 6,478 - 1,307 4. Fixed liabilities 224,834 229,779 - 4,944 Deferred tax assets 3,267 4,156 - 888 4. Fixed liabilities 68,977 76,864 - 7,887 (9) Allowance for doubtful accounts - 3,437 - 3,455 18 (1) Long-term borrowing 105,839 101,619 4,220 Allowance for doubtful accounts - 4,027 - 3,854 - 172 Long-term borrowing 7,265 8,383 - 1,118 2.Fixed assets 681,930 669,436 12,494 (2) Liabilities for retirement benefits 73,450 79,420 - 5,969 2.Fixed assets 366,626 369,186 - 2,559 Long-term accrued liabilities 5,383 6,280 - 896 (1) Tangible fixed assets 1,083,348 1,072,807 10,541 (3) Other long-term provisions 7,770 9,569 - 1,799 Tangible fixed assets 335,937 335,622 315 Long-term deposits received 1,386 1,401 - 14 Less accumulated depreciation - - - (4) Long-term monetary liabilities - Less accumulated depreciation - 194,106 - 194,216 109 Long-term business deposits 1,159 1,200 - 40 667,563 665,769 1,794 19,974 20,703 729 (2) Intangible fixed assets - (5) Assets retirement obligations - Intangible fixed assets 5,652 5,856 - 203 Assets retirement obligations 2,286 2,487 - 201 12,357 12,450 92 6,183 7,266 1,083 Outside investments 170,122 170,348 - 225 Reserve for retirement benefits 51,153 56,754 - 5,601 (3) Outside investments 171,539 164,006 7,533 (6) Long-term deferred tax liabilities 10,557 10,215 341 Long-term securities 27,475 28,659 - 1,184 Allowances and reserves 342 357 - 15 (4) Long-term securities 28,186 29,703 - 1,516 (7) Other fixed liabilities 1,059 984 74 Long-term accounts receivable 581 850 - 268 Total liabilities 876,667 913,552 - 36,885 (5) Long-term loans receivable 23,063 23,130 - 66 Total liabilities 1,243,090 1,305,705 - 62,614 Long-term prepaid expenses - 1,279 1,422 143 5.Net assets 333,621 331,202 2,419 (6) Long-term prepaid expenses 1,567 1,738 - 170 5. Net assets 625,158 610,525 14,632 Other fixed assets - Capitalization - 18,378 18,700 321 115,257 115,261 3 (7) Fixed assets for retirement benefits 2,225 1,663 561 (1) Capitalization 115,257 115,261 - 3 Long-term deferred tax assets 2,186 3,067 - 881 Capital reserve 9,622 9,622 - (8) Other fixed assets 20,110 19,581 529 (2) Capital reserve 9,754 9,711 43 Allowance for doubtful accounts - 208 - 413 205 Revaluation reserve 36 36 - (9) Long-term deferred tax assets - (3) Retained earnings Allowance for doubtful Earned surplus reserve 8,162 11,388 3,225 428,329 417,545 10,784 - 673 - 712 38 97,477 96,517 960 accounts̶outside investments (10) Allowance for doubtful accounts - 869 - 1,036 166 (4) Evaluation adjustment 21,143 19,077 2,066 Voluntary reserve 85,494 81,004 4,490 (11) Allowance for doubtful (5) Minority equity Unappropriated earnings 8,406 11,934 - 3,528 - - 50,748 49,006 1,742 accounts̶outside investments 200 228 28 Evaluation adjustment 17,326 16,825 500 (6) Other - 76 - 76 0 Total 1,210,288 1,244,754 - 34,465 Total 1,210,288 1,244,754 - 34,465 Total 1,868,249 1,916,230 - 47,981 Total 1,868,249 1,916,230 - 47,981 48 49 By publishing the weekly bulletin JA ZEN-NOH Weekly and the food and agriculture magazine Apron, ZEN-NOH strives to communicate information not only to let people know more about itself but also to deepen their understandings of food and agriculture. We also produce radio and television programs whose content includes information about Public relations domestic agricultural and livestock products as well as interviews with JA personnel and producers.

■ Bulletin ge from table tennispl Messa ayer "JA ZEN-NOH Weekly" Website "Apron" Website Kasumi Ishikawa This weekly pamphlet, published since This magazine was launched in 1978 1998, is distributed in 30,000 copies sent to deepen the public's understanding of to JAs and other recipients nationwide, to and sympathy for food and agriculture. It communicate broadly information about ZEN- communicates information including introductions NOH's activities. Its wealth of content includes to producer regions and recipes using seasonal I’ll continue cheering for Japanese food and news about various ZEN-NOH projects, agricultural produce. Starting in 2019, it also initiatives of prefectural headquarters, special is publishing a series of essays on food and agricul ture as a pl ayer on the ZEN-NOH team JA features, and interviews with experts. It agriculture by members of the Japan P.E.N. Club. It also introduced a Web edition in April 2018. publishes 360,000 copies each month, which are T hank you for al l the encouragement you provid e. distributed mainly in A-Coop stores nationwide. The "Ni p pon no Shoku" rice and other Ja panese food s provid ed by ZEN -N OH are my main sources o f Radio ■ energy as I strive to d o the very best I can through "JA ZEN-NOH Countdown Japan" "TODAY’S AGRI NEWS" d aily practice and training while com peting in

Every week, this program welcomes This program provides matches around the worl d . the most topical guests including singers, an introduction to T hanks to your su p port, I intend to kee p d oing my best actors, and celebrities to chat and introduce interesting news from the the latest music charts. One of Tokyo FM's day's Japan Agricultural and avoid injury while eating agricultural and longest-running, best-known programs, it News, including trends in agricultural policies, new JA initiatives, and also gives listeners a chance to win seasonal produce market prices. It also includes a feature in which JA ofﬁ cers from l ivestock prod ucts f rom Ja pan. fruits and rice from JA Town. across the country talk about autonomous reform initiatives. Kasumi Ishikawa, Ja pan National Tabl e Tennis Team Frequency: Tokyo FM (JFN38 network) Frequency: Tokyo FM (JFN38 network) Broadcast time: Every Saturday, 1:00~1:55 pm Broadcast time: Every Monday-Friday, 6:30~6:35 am Hosts: George Williams, Rei Yasuda Host: Ken'ichi Suzumura (voice actor)

"Agrizm Weekend" "Agrizm"（ Nippon "Omusubi" Tayori）

This program conveys the appeal This program supports Japan's agriculture of agriculture through speaking by connecting people through rice balls and with producers from across Japan. increasing consumption of domestic rice through It reports on the activities of new eating rice balls. It provides introductions to famers, the younger generation of listener's episodes related to rice balls and farmers, students at agricultural communicates information on topics such as rice high schools, and more. producer areas and local ingredients. Frequency: Tokyo FM (JFN38 network) Frequency: Tokyo FM (JFN38 network) Broadcast time: Every Saturday, 9:30-9:50 am (Broadcast time may vary by FM station) Broadcast time: Every Thursday, 3:50-4:00 pm (Broadcast time may vary by FM station) Host: Ryoko Kawase Host: Ryoko Kawase

■ TV "Kids' Dinner" "Takkyu Japan!"

The program character Omusubi-kun visits "Takkyu Japan!" is a table-tennis program Photo courtesy: kids working hard across Japan. In every that delivers video highlights from the latest Nittaku News show, one family is presented with a straw tournaments and news about the Japan National bag of rice. They use that rice to make bento Table Tennis Team. It delves deeply into competitive box meals, which everybody then shares. This tactics, the passion of table-tennis athletes, and program aims to support children's dreams other topics. It also introduces ZEN-NOH's efforts through local dishes. to support the activities of Japan National Table Channel: BS Asahi (Channel BS5) Tennis Team athletes through diet. The program's Broadcast time: Every Sunday, 11:55 am-12:00 noon Channel: BS TV Tokyo (Channel BS7) © BS TV Tokyo original character, Rebroadcast: Every Thursday, 10:54-11:00 pm Omusubi-kun Broadcast time: Every Saturday, 10:00-10:54 pm 50