OECD Food and Agricultural Reviews Innovation, Agricultural Productivity and Sustainability in Japan

Foreword Acknowledgements Acronyms Executive Summary Chapter 1. Assessment and recommendations 1.1. Enhancing innovation, productivity and sustainability is a key challenge in the food and agriculture sector globally and in Japan 1.2. Japan’s agriculture is at a turning point After three decades of contraction, Japan’s agriculture show some signs of growth Structural change has driven agricultural productivity growth in Japan Sustainability performance of agriculture has significant room for improvement Demographic trends pose one of the biggest challenges Policymakers face new policy challenges 1.3. Developing policy and market environments more conducive to innovation and entrepreneurship in agriculture A more demand-oriented approach would expand overseas markets for Japanese agro-food products Commercial banks should play a greater role in agricultural finance Farm management policy should have a greater link with small and medium-sized enterprise policy More competitive input and output markets strengthen the sector More diverse formats of land consolidation would contribute to productivity growth in land-intensive farming Infrastructure development policy should adapt to the emerging technology environment Agricultural support policy can be more targeted to innovation, productivity growth and sustainability Despite progress, policies to support rice prices continue to be a major part of agricultural policy Policy programmes cover a large part of the risk 1.4. Sustainability policy objectives should be integrated in agricultural policy framework Japan should develop an integrated framework of agri-environmental policy Sustainable use of water resource requires more effective management of irrigation infrastructure 1.5. More collaboration between public and private actors, and across sectors would strengthen Japan’s agricultural innovation system Innovation in agriculture needs a more systemic approach beyond R&D More engagement of producers, agro-food and other industries in agricultural R&D is key to enhancing demand-driven and open innovation The collaboration in agricultural R&D among AIS actors could be further strengthened More international collaboration in agricultural research would allow Japan’s AIS to benefit from cross-border technology spill-overs 1.6. Enhancing farmers’ skills to innovate is a fundamental part of innovation policy in agriculture Innovation in agriculture needs wider skills to adapt emerging technologies Professional education in agriculture should correspond better to needed skills Public agricultural extension systems should evolve to increase the role of private technical service providers References Chapter 2. Overview of the food and agriculture situation in Japan 2.1. General economic context Agriculture in the Japanese economy Demographic change 2.2. Characteristics of the agricultural and agro-food sectors in Japan Production Consumption Trade Farm structure Farm income 2.3. Productivity performance of agriculture in Japan 2.4. Sustainability performance of agriculture in Japan Nutrient balance Pesticides Water Energy use and GHG emissions Climate change 2.5. Summary Notes References Chapter 3. General policy environment for food and agriculture in Japan 3.1. Macroeconomic policy environment 3.2. Public governance 3.3. Trade and investment policy Trade policy Foreign Direct Investment (FDI) policy 3.4. Policy environment for entrepreneurship 3.5. Financial market policy 3.6. Infrastructure development policy Information and Communication Technology (ICT) infrastructure 3.7. Natural resource management policy General environmental policy Main environmental regulations Specific regulation on farm inputs and emissions Fertiliser Pesticides Livestock manure management Climate change policy Water resource management Land use policy 3.8. Key points Notes References Chapter 4. Agricultural policy environment in Japan 4.1. Agricultural policy objectives 4.2. Overview of agricultural policy 4.3. Agricultural trade policy Promotion of bilateral and regional Economic Partnership Agreements Export promotion policy 4.4. Domestic agricultural policy Domestic price support programmes Rice Milk Programmes to support farm income or reduce costs Programmes to support farm risk management Price and income stabilisation payments Agricultural insurance programmes Preferential tax treatment 4.5. Agri-environmental policy 4.6. Key points Notes References Chapter 5. Agricultural innovation systems in Japan 5.1. General characteristics of innovation systems in Japan National innovation policy framework 5.2. Main actors and governance of the agricultural innovation system The role of AIS actors in Japan Government National agricultural research organisations (NARO) Prefectural agricultural research organisations Prefectural extension services Universities Private companies, associations and producers Governance of AIS in Japan Policy framework and funding mechanisms Monitoring and evaluation 5.3. Investment and outcomes in agriculture and food R&D Trends in public and private R&D investment R&D outcomes 5.4. Creating knowledge markets and networks Public-private collaboration in agricultural R&D Intellectual property protection Preferential taxation and R&D 5.5. International R&D collaboration Promoting international joint research Technology in developing countries and responses to global issues Participation in international frameworks for agricultural research 5.6. Key points Notes References Chapter 6. Human capital development in Japan’s agriculture 6.1. Changing skill needs for agriculture in Japan 6.2. Agricultural education 6.3. Policies to support new entrants and farm succession Policies to support new entrants to farming Measures to facilitate a smooth farm succession 6.4. Extension and advisory service 6.5. Labour market policy 6.6. Key points References Blank Page In Japan, agriculture has been treated differently from other parts of the national economy. However, policy needs to evolve with new agricultural structures and the global trend towards more integrated value chains, enabling innovation and entrepreneurship in agriculture, and imposing a greater environmental responsibility on producers. Modern agriculture is a technology- and data-intensive industry, and Japan is well-positioned to introduce its competitive technology and skills to agriculture through building more collaborative agricultural innovation system