Archive for the ‘Food & drink’ Category

Australian EPA: Let them eat beef (but not cheese)

Monday, April 14th, 2014

Stuck in the middle: Australian cheese competing in the dairy case with New Zealand and Switzerland

Stuck in the middle: Australia cheese competing in the dairy case with New Zealand and Switzerland

Though its participation in the Trans-Pacific Partnership seems to be dead in the water for the time being, last week Japan signed an Economic Partnership Agreement (EPA) with Australia that could revive Japan’s TPP hopes, but before we get to who lost and who won in the Australian deal, let’s talk about cheese.

Personally, we were looking forward to some sort or tariff reduction on Aussie cheese, not because we prefer Aussie cheese over other kinds, but because all so-called natural cheese — meaning not processed — is expensive in Japan owing to the dairy farmers lobby and their demand for high tariffs on imported milk products.

Japan is close to an EPA with the European Union, but the cheese tariff will likely remain. The Australian EPA only addresses natural cheese that is exported to Japan for purposes of being blended with other ingredients to make processed cheese. The tariff on such cheeses will be reduced from 40 to 0 percent over time, but the tariff on natural cheese that is sold to the public in stores will remain at 29.8 percent, so no cheap cheddar right away.

According to Asahi Shimbun, cheese consumption in Japan is steadily rising. Japanese bought 285,000 tons of cheese in 2012, twice as much as they did in 1992. The agriculture ministry predicts that consumption will increase by 40,000 tons over the next 10 years, and domestic production will not be able to satisfy this demand.

Nevertheless, dairy farmers insist on keeping the tariff at its current level, otherwise they say they’ll be wiped out. We’re talking small dairy farmers, not big companies like Meiji and Yukijirushi, which will probably benefit from the tariff since they deal in processed cheese. Naturally, Australian dairy farmers are disappointed that the tariff for natural cheese was not reduced, since the bulk of their export business is cheese for consumers, not cheese for processing.

On the other hand, beef producers are quite happy with the EPA. As a result of the agreement, beef exports to Japan are expected to increase by $5.5 billion (¥530 billion) over the next 20 years, which should give pause to American trade negotiators. Right now the tariff on beef is 38.5 percent, and that will decrease to 19.5 percent in 18 years for frozen beef and to 23.5 percent for refrigerated beef.

Vintners are even more encouraged by the EPA. In seven years the tariff on Australian wine to Japan will be reduced to zero, which means they’ll be more competitive with wines from Chile, which completed an EPA with Japan some years ago. Since then, sales of Australian wines in Japan declined by a third. Right now Australia claims 4 percent of Japan’s wine market and Chile 14 percent.

As with cheese, wine consumption in Japan is also on the rise, so Australian wine makers are confident they can regain the market share they lost when Chile signed its EPA with Japan. However, it should also be noted that in accordance with the aforementioned EPA that Japan is working out with the EU, European wine tariffs will also eventually be reduced to zero, so competition will likely get fiercer.

What does Japan get out of this? Mainly less restrictions for automobile sales in Australia. Half the goods and services exported to Australia from Japan is in the form of automobiles: 359,170 cars in 2013, second only to the U.S. — a far second, since American exported 1.7 million vehicles to Down Under. Japan was desperate to get a deal on cars because in accordance with a trade agreement with Korea, Australian duties on Korean cars will drop to zero by 2015.

For the record, 70 percent of Australian exports to Japan are in the energy and mining sectors — coal, natural gas, iron ore — and aren’t taxed because Japan no longer has much of a mining industry to protect and desperately needs these resources. However, it should be pointed out that Australia is No. 10 on the list of countries receiving Japanese exports, about ¥1.7 trillion a year; while Japan is No. 3 on the list of countries receiving Australian exports, about ¥5 trillion. So you decide who gets the better deal in this agreement.

Us? We’d rather have cheese.

Tax structure encourages getting wasted

Monday, March 3rd, 2014

Zero's not in it: Selection of Suntory chuhai at discount store

Zero’s not in it: Selection of Suntory chuhai at discount store

There’s no end to speculation as to how the consumption tax increase in April will affect the country, socially as well as economically. Last week, Tokyo Shimbun published a conversation between a college professor and one of its reporters about the effect on beer prices and, in turn, beer consumption, which last year declined for the ninth year in a row.

When the reporter asks the professor about this effect the professor feigns amazement that the reporter, who specializes in tax matters, didn’t know that “42 percent of the price you pay for your beer is already tax.” He goes on to explain that the beer tax is a holdover from the 19th century, when beer was considered a luxury item. Since then it’s become much more the drink of common people thanks to improved and cheaper refrigeration, but the government liked the revenues too much and maintained the tax structure for beer. To the professor’s thinking, the tax should be pegged to alcoholic content, and since beer’s is relatively low the tax should also be lower than it is for other alcoholic beverages.

It’s easy to get people to pay the tax since it isn’t indicated on the package or even at the place of sale, unlike the consumption tax. For the sake of reference, when you buy a 350-ml can of beer you pay ¥77 in tax. If you bought the same volume of whiskey you’d pay ¥129 in tax; shochu ¥70, nihonshu ¥42 and wine ¥28.

Basically, that means the consumption tax is levied on a tax, since the consumption tax is determined by the price that the wholesaler and retailer pays for the product, which, by the time they receive it, already includes the alcohol tax that is levied at the manufacturing stage. “When the government said they’d increase the consumption tax, people got angry,” says the professor. “But no one says anything about the alcohol tax, because people don’t notice it.” The reporter thinks that a “tax on a tax” violates the principle of taxation. The professor doesn’t disagree, and adds that beer accounts for half the revenues brought in by the alcohol tax. Because beer makers are large companies with responsible accounting practices, it’s easy for the Finance Ministry to collect the tax. The reporter says, “Why don’t manufacturers get angry?”

Actually, that’s why they started making the “beer-like” happoshu in the late ’90s. Because the ingredients used in happoshu are different from those that define beer for tax purposes, the beer tax doesn’t apply, and so makers could sell it at a much lower price. The government, of course, didn’t like that and eventually raised the tax rate for happoshu, too, though not as high as it is for beer (¥46 for a 350-ml can). Makers came back again with dai-san (third type) beverages, which use fermented soybeans for flavor instead of hops, and that got around the happoshu tax (¥28 for 350-ml). But while these new, cheaper brews outsold “real” beer handily, sales for all three beverages have still decreased over time, due to the shrinking population and a younger generation of consumers who don’t drink as much as their parents did.

In that regard, beer makers don’t see much of an impact of the consumption tax hike on beer and beer-like beverage sales; or, at least, they don’t see any point in trying to offset the hike. But they are modifying their lines of canned drinks that contain shochu, colloquially called chuhai. As the price of chuhai goes up thanks to the consumption tax, they are increasing the alcohol content. In fact, many companies have already added more alcohol to their chuhai products.

Kirin Beer increased its Hyoketsu Strong from 8 percent to 9 percent alcohol, and in April it will boost its Hon-shibori Lime chuhai drink from 6 to 8 percent.

Asahi Beer is already advertising its new Karakuchi Shochu Highball, which is 8 percent, in a bid to persuade normal fans of high balls — whiskey and soda — to switch to shochu and soda. That’s a full 5 percentage points higher than Asahi’s other chuhai, Slat, and both beverages will be sold for the same price. (Note: Slat is aimed at young women and the word suggests slimness, though an English speaker may be forgiven for thinking the name an unfortunate choice for such a target group.)

Suntory’s chuhai product, -196 Degrees C Strong, which enjoyed a 22 percent share of the chuhai market in 2012 thanks to its already hefty alcohol content, will be strengthened from 8 to 9 percent. The company told Asahi Shimbun that it expects sales to grow by 8 percent.

The target is middle-aged and elderly men, the main demographic for alcoholic beverages anyway. Makers think they will be attracted to the cost effectiveness, according to the Asahi, which means they can “get drunk more easily” for the same amount of money. In many countries, tax on alcohol is referred to as a “sin tax,” since it has a double-edged purpose: raising revenues on a product or service that may be harmful to society, on the one hand, and on the other checking consumption of the harmful product or service by making it more expensive.

This latter purpose doesn’t seem to apply in Japan, where alcohol companies have figured out a way to use the tax structure to their advantage. There’s no sin in that.

Part-timers skewing employment statistics

Thursday, January 2nd, 2014

Take this job and...: Want ads targeting part-timers for specific shifts at a Chiba Prefecture supermarket

Take this job and…: Want ads targeting part-timers for specific shifts at a Chiba Prefecture supermarket

When the government determines the success of Abenomics it has to take into consideration wage inflation, not just price inflation, since real growth can’t be sustained without both. Nevertheless, all wage inflation isn’t created equal.

A recent article in the Asahi Shimbun cited results of a regular survey conducted by Recruit Jobs, an employment-related research institute. In the major metropolitan areas of Japan the average wage offered to part-time food service workers in want ads in November was ¥930, which is 1.3 percent higher than the average amount offered in November 2012. More significantly, this year-on-year increase has been continuing for 25 consecutive months, the longest stretch of increases since the institute started tracking such numbers in 2007.

The standard wage in the restaurant industry is relatively low to begin with, and right now there is a shortage of help nationwide, so Recruit says employers are being forced to offer more money. One example cited by Asahi is a new mall that just opened in Makuhari, Chiba Prefecture, which contains a number of eating establishments, most of which belong to chain operations. Starting wages at these restaurants is between ¥1,200 and ¥1,300 an hour, which is even higher than they are in Tokyo. According to an official at Four Seeds, a company that owns several restaurant chains, more large retail facilities, such as shopping malls, are being built in an around major metropolitan areas, so there is greater demand for food service workers.

However, these numbers are misleading in terms of indicating whether or not the economy as a whole is on the mend. For one thing, the labor ministry says that just because part-time wages in major cities are going up, it doesn’t mean they’re rising for the rest of Japan.

The ministry found that in October, the average monthly take-home for “short-hour part-timers” was ¥94,634, which is 0.4 percent lower than it was in October 2012, and marked five straight months of year-on-year declines. And if the average pay for a part-timer in this industry in 2010 was set at 100, then the salary this year is 98.7.

Despite the fact that the national minimum wage was raised recently, average part-time income is dropping, mainly because companies are hiring more people to work short hours. For instance, the coffee shop chain Pronto targets housewives (which they call “mistresses”) in their 30s and 40s with the promise that they don’t have to work weekends and holidays. In addition, they can take off up to nine full weeks, without pay, of course, in a given six-month period. These women don’t work more than 20 hours a week, and the company likes it because under these conditions they can easily find women willing to work for low pay at short notice.

This trend is also prevalent in the supermarket industry, where employers pay housewives slightly more to work in the morning and the evenings since most housewives prefer only working in the afternoon when they don’t have household responsibilities.

In Tokyo, many food service companies offer higher wages only for peak demand periods to fill short-term staffing shortages. Other times they offer less money. The turnover is high, but this strategy allows the companies more options in controlling personnel costs on a month-to-month basis.

The point is that these workers supposedly want to work shorter hours, and the more people there are working shorter hours for slightly more pay, the more the statistics will reflect higher wages overall, but in truth the pay is just being distributed among more people, meaning per capita wages aren’t going up at all.

Of course, food services is traditionally considered an entry-level or temporary job, not a career track job, but as manufacturing continues to shift overseas, it is an industry that will become more vital as an employer. It’s not quite at the stage that it is in the U.S., where many fast food workers have to support families on what they make, but it might be getting there.

McDonald’s smells the coffee: Limited expectations are here to stay

Friday, December 27th, 2013

Fill 'er up: Customer using self-service coffee maker at 7-11.

Fill ‘er up: Customer using self-service coffee maker at 7-11.

If the central point of Abenomics is to boost prices and thus wages and consumption — the old “raise all boats” metaphor — then to a certain extent the plan has succeeded over the last year. Consumers don’t seem to be fixated on cheap goods and services any more, though, to be honest, it’s difficult to tell if this willingness to spend more is a function of anticipation for April’s consumption tax hike. But for the time being there seems to be that old desire for high quality stuff, regardless of how much it costs; which isn’t to say consumers aren’t looking for cheap things, only that they aren’t making it a priority any more.

This paradox seems to have had a bad effect on the fortunes of a company that some once thought was invincible: McDonald’s. Since August, the fast food behemoth’s Japanese operation has had to lower its sales projection for fiscal 2013 twice. Profits are expected to be around ¥5 billion, or a whopping ¥6.7 billion lower than originally thought. Sales have decreased five months in row, with the number of customers dropping for 7 consecutive months. The company is telling the media that the reason is “no hit product” this year, thus making it sound like a PR failure, but according to Asahi Shimbun, and almost every other Japanese media that has reported the story, McDonalds’ poor showing seems to be more systemic, an indication of a sea change in consumer sentiment.

The company’s response has been to bring in new blood. Sarah Casanova, a Canadian, was appointed president of McDonald’s Japan last summer, and, again, it seems to be more a matter of an image makeover. The announced new strategy is to target women as a demographic, since it is younger females who have tended to resist McD’s charms the most during its two straight years of falling revenues. The plan reinforces “healthy menu” items, which to a company like McDonald’s means offering more things with chicken in them.

Though it doesn’t sound like much, it’s actually quite a turnaround. When the previous president, Eiko Harada, was appointed in 2004 his big move was pushing the so-called ¥100 Mac, the cheap hamburger that was always going to be McDonald’s mainstay, and it worked. For the next six years profits grew.

The next big coup was ¥100 coffee, which effectively challenged coffee shops and coffee chains like Starbucks. Then the company made over their restaurants with more attractive decor. These various gambits were predicated on boosting the brand, but actually it was the price and the speed of service that mattered to customers. People buy McDonald’s hamburgers not because of the taste or the atmosphere, but because they’re cheap, and the same went for the coffee, which was pretty good considering but not as good as Starbucks, for what it’s worth.

To make matters worse, McDonald’s raised prices in the past year, thinking that the economy justified the change, and in a way it did, but people don’t think that way about McDonald’s. They aren’t willing to pay more for fast food, no matter how well it’s presented or how nice the decor is.

In the era of Abenomics, that means any competition can eat into McDonald’s sales more easily. Just as McD stole customers away from Starbucks when it launched its ¥100 coffee, now convenience stores are taking business away from McD with their own cheap coffee. About a year ago 7-11 put self-service coffee machines, which grind beans and brew coffee while you wait, in 16,000 stores, and by September they had sold 200 million cups. It only costs ¥100, and other CS have followed suit, though Lawson’s coffee is a bit more expensive at ¥150.

The market has grown so much that the consumer report magazine Nikkei Trendy named convenience store coffee the #1 hitto shohin (hit merchandise) of the year. It should be noted that Japan is a formidable coffee market, number 4 in the world in terms of consumption — 50 percent more than green tea, in fact. Even sushi restaurants are now serving fresh coffee. More significantly, 7-11 reports that its new coffee service does not subtract from other in-store coffee-related sales, such as canned coffee or chilled pack coffees. It’s simply gravy.

But someone has to lose in this equation, and it seems to be McDonald’s, which has a lot to lose. After all, ¥260 billion, which is McD’s projected revenue this year, is still a great deal of money. The problem is that McD is associated with hamburgers, whose traction on the Japanese imagination has always been tentative. Older people don’t really eat them as much, and Japan, as everyone knows, is the fastest aging society in the world.

Also, the tendency to eat out is becoming weaker in Japan as the population ages. Restaurant sales have decreased by 20 percent since they peaked in 1997. The weekly magazine Gendai, in typical hyperbolic fashion, has predicted the end of McDonald’s in Japan after reporting that the company will have closed 160 outlets by the end of this fiscal year.

Where’s the beef? Japanese taste buds dictate processing methods

Wednesday, November 13th, 2013

Something to chew on: Packages of fat-injected processed beef in a supermarket

Something to chew on: Packages of fat-injected processed beef in a supermarket

Thanks to the hotel restaurant menu scandal, even food retailers’ product descriptions have come under scrutiny. Internet mall Rakuten received the biggest black eye, though it appears to have been for a genuine mistake and not because of a planned deception. To celebrate its baseball team’s Japan Series victory, Rakuten held a bargain sale that marked some prices down as much as 77 percent, but in several cases the markdowns were carried out so sloppily that a whole digit was lost. For instance, an A5-grade, 550-gram “steak set” that normally sells for ¥18,400 was marked down to ¥1,000, which is a lot more than 77 percent.

The sale price was supposed to be ¥10,000, but somehow one of the zeroes didn’t make the transition. Rakuten received lots of complaints and had to apologize again (having already suffered the same mistake over boxes of cream puffs) and fork out refunds, but anyone who knows anything about Japanese beef prices should have realized that ¥1,000 for Tosa-bred wagyu (Japanese beef) had to be an error.

Increased scrutiny, in fact, has revealed that many indications for beef, whether sold in restaurants or in stores, while not being technically deceptive are less then forthcoming. Aera reports that one Hokkaido beef wholesaler has been cited for misrepresenting its wares, calling some of its items “beef” when it should be labeled “processed beef” (kako-niku).

The closer attention to wording was probably fallout from the menu scandal, in which Osaka’s Shin-Hankyu Hotel was found to be at fault for listing processed beef as “beef steak,” which it is not. The Kintetsu Hotel restaurant, awarded a star by Michelin, sells processed beef as wagyu steak for a whopping ¥6,300. Even Takashimaya department store’s “beef filets” were found to be processed. A steak or filet is a cut of meat that has not been changed in any way, but many meat sellers take cheaper cuts of beef and inject them with fat to give them the marbled effect that Japanese people prefer.

In the West, the adjective “lean,” which implies less fat, is considered a positive attribute for beef, but wagyu is characteristically streaked with fat, which means it has a richer flavor and is more tender. Generally speaking, the beef that Americans, Australians and Europeans eat is considered by Japanese to be tough and difficult to chew. Thanks to improvements in feed grains in the early 90s, American producers developed softer beef for the Japanese market, which is why so many fast food chains prefer using cheaper USA beef.

Most Australia beef sold in Japan has been processed, meaning that fat has been added. Some store cuts that look like steak may even have been “molded” (seikei). Different pieces of meat are “glued” together to make what looks like a steak and then injected with fat. A friend of ours who once had a job promoting “Aussie Beef” in Japan said the joke among his Australian colleagues was that “Japanese really don’t like the taste of beef,” since to Australians real beef is chewy and has no fat.

It should be noted that the reason beef is chewy is because the cattle is more muscular, in other words healthier than cattle that has more fat. Australian cattle are typically raised on the range where they eat grass, while in Japan and America the cows are penned up and fed grain (and lots of antibiotics to fight the infections that such a diet gives rise to). Also, range-raised beef is not as susceptible to BSE (mad cow disease).

Restaurants and retailers are required by law to indicate that their meat is processed, but the print tends to be tiny and obscure. This could cause problems, however, since ingredients used to process the fat can include dairy and soy products, which many people are allergic to. Parents of at-risk children know to look for the fine print, but restaurants are supposed to ask customers if they have any food allergies when people call on the phone for takeout. If the person says yes, then “real” beef will be substituted for the usual processed kind.

In stores, however, it’s quite easy to determine which meat is real and which is processed without having to squint. Just look at the price. According to Asahi Shimbun, one kilogram of unprocessed grade A3 (highest: A5) Japanese sirloin is at least ¥5,000 per kilogram, whereas one kilogram of processed sirloin is between ¥1,400 and ¥2,000. Seikei cuts of meat are only ¥700-¥800 per kg. What’s interesting is that while fat-injection has been a common practice since the early 1980s, it was always thought of mainly as an economic measure. The purpose was to make beef affordable on an everyday level, but the Asahi reports that many restaurants now say that their customers prefer the taste of cheaper processed beef to more expensive genuine cuts of beef, even when that genuine beef is sufficiently marbled.

Say goodbye to plentiful, affordable shrimp

Friday, October 25th, 2013

Squeezed out: Shrimp tempura in a supermarket

Squeezed out: Shrimp tempura in a supermarket

Last week the national fast food chain Tenya, which specializes in tempura dishes, announced that it was discontinuing two of its most popular menu items effective Oct. 20: jotendon (¥580) and ebiten soba or udon (¥790). Both dishes feature prawns deep fried in batter — the former offers two big prawns on top of a bowl of rice, and the latter one big prawn in a bowl of either soba or udon noodles. The reason for the move is the skyrocketing price of shrimp. As a concession, Tenya will continue serving tendon (¥500), which only features one fried prawn on a bowl of rice, and introduce ebi oika tendon (¥590) — one prawn and one slab of squid on rice.

Tenya’s parent company, Royal Holdings, said in a statement that the Southeast Asian shrimp farms from which it buys its prawns have been hit with a disease called early mortality syndrome (EMS) that has decimated stocks, the result being that prices have doubled. The EMS plague affects shrimp prices all over the world, especially in the U.S., which consumes more shrimp than any other country. Since most shrimp farms are, almost by definition, ecologically destructive, the spread of disease is hardly surprising, and it isn’t certain if the industry will be able to recover.

That’s a serious problem for Japan, where shrimp, or ebi, has a special place in the national cuisine. Before the 1980s, tendon using prawns was considered an extravagant dish for the average Japanese person, and it remains one of the most popular meals to this day, beloved by all classes of people. Tendon is by far the most popular item on Tenya’s menu, with the now discontinued jotendon in fourth place, according to a recent report on TV Asahi. Moreover, the kaiten sushi (conveyor belt sushi) chain Sushiro has also announced that it will be suspending sales of many dishes that use shrimp due to the “worldwide shortage.” Family restaurants and convenience stores will also cut back on the number of products they sell that feature ebi.

The shortage has given rise to rumors that some Japanese restaurants and food makers have been using crayfish (zarigani) as a substitute for shrimp without telling customers. There are sushi restaurants in the U.S. that serve crayfish openly, but most Japanese people find the fresh water crustacean unappetizing. The American species of crayfish was brought to Japan by the U.S. military during the postwar occupation as a protein supplement, and now can be commonly found in rivers and streams. Japanese tend to be streotyped as able to eat almost anything but they’ve never taken to crayfish, which in the U.S. is normally eaten in the South.

It’s the kind of rumor that some restaurants would take seriously. Coincidentally or not, the Hankyu Hanshin Hotel group recently announced that it would provide refunds to anyone who purchased any of 47 dishes in its restaurants between 2006 and February of this year.

Apparently, the ingredients in these dishes weren’t as expensive as the restaurants claimed they were. Among the mislabeled dishes was shiba ebi, a high quality breed of domestic shrimp that costs ¥2,500 per kg wholesale. The restaurants were actually using a much cheaper breed, which only costs ¥1,400 per kg. The hotel group calculates that 78,775 people purchased these dishes during the time period cited. It has put aside ¥110 million for refunds, which begs the question: Do all those people still have their receipts?

Lower egg prices bad for producers, worse for chickens

Monday, October 7th, 2013

Which came first?

Which came first?

Over the summer the retail price of eggs has increased anywhere from 20 to 50 percent, which is a significant change for consumers but also for people who are pushing Abenomics and its focus on reigniting inflation, since eggs have for years been seemingly been impervious to price changes. At the beginning of May, it cost about the same to buy a package of 10 eggs as it cost to buy a package of ten eggs thirty years ago. As the prime buka no yutosei (best “student” among product prices), it’s one of those constants people took for granted.

However, the sudden increase was not entirely due to serendipity or natural market forces. In fact, the price hike was engineered in a bid to maintain market stability. In 2011 the agriculture ministry implemented a subsidy to control the price of eggs. Because a sudden drop in price can have an immediate harmful effect on egg producers’ bottom lines and potentially damage the industry as a whole, the ministry automatically provides funds when the wholesale price goes below ¥159 per kilogram. These funds are used to cull egg-laying chickens in order to reduce supply and put pressure on demand, thus pushing the price back up.

According to Tokyo Shimbun, in May the price dropped below the designated line and the subsidy kicked in. Producers receive ¥150-¥200 for every chicken they kill, and the ministry estimates that from mid-May until mid-July, when the subsidy was available, about 5 million birds were culled. Not all were thrown away. Many were processed and sold as meat, for which the producers can earn an additional ¥20-¥50 per bird, an aspect that makes the system even more popular among producers since it rationalizes the process of replacing chickens.

Usually, a hen becomes productive — meaning it starts laying eggs — 150 days after birth, and remains productive for about 500 days. The dropping off point for production can vary greatly from one bird to the next, so whenever the subsidy is in effect egg producers get rid of those older chickens that are borderline productive since it is monetarily advantageous to do so under the system. Egg production is a relatively easy farming method since it is all about volume. In the past ten years the average number of chickens kept by each producer has increased from about 33,000 to more than 50,000, thus indicating the loss of small-scale farmers and the dominance of corporate egg producers.

Of course, when it’s all about volume it’s also all about controlling inventory, which is bad for chickens. Besides the horrendous factory conditions that egg-laying hens have to endure, their fate is also subject to capricious market forces, not to mention natural ones.

This summer was one of the hottest on record, and a lot of chickens died from heat stroke, so even after the subsidy system was lifted in July, the number of producing hens continued to decrease, sending the price of eggs to its highest levels ever. Moreover, one condition for receiving subsidies is that the producer not replace culled chickens for at least 60 days. According to JA, its Zenno Tamago brand, often used as the index for egg prices, was up by as much as ¥55 per kg on Sept. 27 compared to the same date in 2012. (For reference one LL-size egg is 70-76 grams, and one kg now costs about ¥225.) But chickens grow fast, so the price is expected to drop to its normal level by December’s Christmas cake season.

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