USDA Foreign Agricultural Service GAIN Report Global Agriculture Information Network Template Version 2.09 Voluntary Report - Public distribution Date: 1/23/2009 GAIN Report Number: JA9502 JA9501 Japan Agricultural Situation The History of U.S. Soybean Exports to Japan 2009 Approved by: Geoffrey Wiggin, Minister Counselor for Ag Affairs Prepared by: Michael Conlon, Agricultural Trade Officer Report Highlights: FAS Japan is writing a series of reports on the history of U.S. agricultural exports to Japan. These reports showcase the unique partnership between U.S. cooperators, USDA's Foreign Agricultural Service (FAS), and Japan's food and agriculture sector that has made Japan the most successful country for the market development of U.S. food products in history. Includes PSD Changes: No Includes Trade Matrix: No Annual Report Tokyo ATO [JA2] [JA] GAIN Report - JA9502 Page 2 of 14 Table of Contents Introduction: The Amazing Soybean.....................................................................3 The Auckland ......................................................................................................4 Perry and the Black Ships ....................................................................................4 William Morse: USDA’s Plant Explorer in Japan and the Father of Soybeans in America ..............................................................................................................5 U.S. Market Development Efforts in Japan ............................................................6 Recent Activities in Market Development ............................................................ 11 End Notes ......................................................................................................... 13 UNCLASSIFIED USDA Foreign Agricultural Service GAIN Report - JA9502 Page 3 of 14 Introduction: The Amazing Soybean Soybeans are an amazing crop, produced for food, industrial products, and livestock feed. Soybeans originated in China and are one of the oldest cultivated crops. Soybeans most likely came to Japan from China between the 6th and 8th centuries with the spread of Buddhism.1 Because of the vegetarian philosophy of Buddhism, as the religion expanded throughout East Asia so did the use of soy foods. The earliest reference to soybeans in Japan is in the Kojiki (Records of Ancient Matters), which was complete in 712 AD and is the oldest surviving book dealing with ancient Japan. Soybeans have been an important source of protein in the Japanese diet for centuries. This is apparent by the wide assortment of soy foods in Japan such as shoyu (soy sauce), tofu (soybean curd), miso (soybean paste), natto (fermented soybeans), kinako (roasted soybean flour), and aburaage (deep fried sliced tofu). With this ancient history, Japan helped to introduce soybeans into the United States. Indeed, the English word “soy” is believed to be derived from the Japanese shoyu or soy sauce.2 Japan eventually became a major market for the United States after World War II because of the efforts of the U.S. soybean industry, FAS, and the Japanese industry. This interdependence between the United States and Japan is nothing short of extraordinary. For over 50 years, Japan has been a critical export market for U.S. soybeans and products. For most of that time Japan was the largest market for the United States. From less than 3,500 metric tons in 1946, Japan became our largest export market in 1955 at 572,050 metric tons, increasing to over 1 million metric tons in 1960, 2 million metric tons in 1968, 3 million metric tons in 1972, and to a record 4.6 million metric tons in U.S. Soybean Exports to Japan 1983. During this 38 year period, exports 4,646 increased over 1,350 percent. U.S. soybean 5000 exports to Japan reached a cumulative total of 4000 3,126 3,325 100 million metric tons in 1991. Since 1946, 3000 1,000 Metric 2,001 the United States has exported 159,988,363 Tons 2000 1,091 metric tons of soybeans to Japan. The 572 1000 3.4 magnitude of this success can be summed up 0 by Shinji Sasaki, President of the Japan 1946 1955 1960 1968 1972 1983 2007 Oilseed Processors Association (JOPA), who Years stated that from 1956 through 2005, 84 percent of Japanese soybean imports came Source: ASA-IM Tokyo from America.3 In 2007, Japan was the third largest export market for U.S. soybeans at over three million metric tons, or more than $1 billion, including a significant amount of identity preserved (IP), food grade soybeans. Japan’s requirement that all food bean soybeans originate from non-biotech varieties is the driver of the IP market.4 The U.S. share in the Japanese market is currently around 76 percent. Japan was the United States’ fourth largest market for soybean meal at $125 million in 2007, and 10th largest market for soybean oil at $16 million.5 UNCLASSIFIED USDA Foreign Agricultural Service GAIN Report - JA9502 Page 4 of 14 The Auckland Through a series of unusual events, the soybean relationship between the United States and 6 Japan began even before Japan opened its doors to the rest of the world. In December of 1850, the Aukland, an American merchant ship, left Hong Kong for San Francisco carrying sugar and other general merchandise. Several hundred miles off the coast of Japan, the ship came across the Japanese junk, the Eiriki Maru. The junk was damaged in a violent storm and it had drifted at sea for several days. Because of the Japanese government’s isolation policy, Japanese ships of the period were not designed for long ocean voyages, and so the Eiriki Maru tossed helplessly in the waves. The 17-member Japanese crew was rescued from the boat and placed on board the Auckland, which continued on to San Francisco. The youngest member of the Eiriki Maru was Hikozo Hamada (1837-1897), who later became known as Joseph Heko. Heko became the first Japanese to become an American citizen.7 In his autobiography, Heko described how they were not accustomed to eating meat because they were Buddhist and at first refused to eat “meat and butter.”8 In fact, after witnessing the cook from the Auckland slaughtering a pig on the ship the Japanese became concerned that these “barbarians” would start to eat them. Later, the Japanese became accustomed to the American food. As Heko remarked “when in Rome do as the Romans do.” In San Francisco, the Japanese were not permitted to go ashore because of the possibility of spreading diseases. Dr. Benjamin Franklin Edwards was returning to Illinois after two years in California unsuccessfully searching for his fortune in the California gold rush.9 Dr. Edwards was not the usual type of fortune seeker, as he was a member of a wealthy and influential family. By coincidence, Dr. Edwards was at the dock waiting to return to Illinois by passenger ship through the Panama overland route. He examined the shipwrecked sailors and declared them free of any contagious diseases. As a gesture of appreciation, the Japanese gave Dr. Edwards a gift of a packet of soybeans that he carried back to Illinois. These soybean seeds were eventually distributed to the New York State Agricultural Society, the Massachusetts Horticultural Society, and the Office of the Commissioner of Patents. Prior to the establishment of the U.S. Department of Agriculture in 1862 by President Lincoln, agricultural affairs were handled by the Office of the Commissioner of Patents. The two societies and the Commissioner of Patents sent soybean seeds to farmers throughout the United States. Perry and the Black Ships One can say our official relationship with Japan began when Commodore Matthew C. Perry and his heavily armed black ships opened up Japan to the rest of the world after centuries of isolation. From 1636, Japan had a national isolation policy, closing itself off to foreigners except for the Chinese and the Dutch. The U.S.-Japan Expedition left for Japan in November, 1852, under the direction of Commodore Perry, for the purpose of opening Japan to foreign trade. He brought President Fillmore's letter addressed to the Shogun, threatening that if refused, Japan would face military action. In the early 1850s whaling was booming in the Pacific Ocean. Plenty of U.S. whaling boats were operating near Japan's coast and desperately needed water, food and coal. In 1854, Japan reluctantly signed the Treaty of Peace and Amity with the United States and agreed to open two ports, Shimoda and Hakodate. UNCLASSIFIED USDA Foreign Agricultural Service GAIN Report - JA9502 Page 5 of 14 The expedition’s agriculturist was Dr. James Morrow. 10 Morrow was a medical doctor from South Carolina with a strong interest in agriculture. He was responsible for assembling and demonstrating the agricultural instruments that were brought on the expedition as gifts for the Emperor. He also brought vegetable seeds as gifts for the Japanese. However, Morrow's primary responsibility was collecting seeds and plants from Japan, and he collected between 1,500 and 2,000 specimens of plants during the expedition. One of Morrow’s introductions had a profound impact on U.S. agriculture. The expedition’s surgeon, Dr. Daniel Green, observed that the Japanese grew a peculiar kind of bean called the Japan pea (i.e., soybean).11 Morrow obtained soybean seeds from Japan that he sent to the Patent Office, which later distributed the seeds to farmers in the United States.12 Through the effort of Benjamin Edwards and James Morrow, by the late 1850s soybeans were grown, propagated, and evaluated by farmers throughout the United States. Articles were written in agricultural