The aim of this paper is to clarify the significance of the liberalization of fruit trade in Japan and to analyze its basic structure.
Japanese agriculture is becoming deeply involved in the international interdependence economy. Today, free trade is closely tied in with global-scale investment and trade in multinational enterprises.
The fruit trade of Japan, formerly a simple structure wherein only bananas were imported, has changed to a complex structure wherein citrus fruits and other fruit are imported, thereby expanding trade channels in the Pacific area.
Low-cost production is a feature of the banana industry whereas cosmetic quality is a feature of the citrus industry.
In the 1980s, the banana trade changed from a competitive structure to an oligopolistic structure that is comprised of what are known as “the big four” because now only four groups have a monopoly of 76.8% of the banana market share in Japan. The oligopolistic integration is defined as the system whereby multinational fruit enterprises, as shippers, consolidate exclusive business connections with large-scale Japanese trading companies known as soogoshosha. The soogoshosha act as importers, organizing company groups of minor distributors and wholesalers handling imported fruit.
The oligopolistic integrator accumulated buyers by arranging the sale of various sort of fruit. The integrator invests in large-scale citrus farms or packing houses to directly sell its own brands. This layer structure results in overlapping distribution channels for bananas and citrus. Minor citrus importers are thus subject to the integrator and lose their independence. In this oligopolistic structure, there is increased opportunity to manipulate the transfer pricing mechanism by regulating or adjusting the supply.
This is the basic structure which is the subject of the fruit trade liberalization negotiation between Japan and the U.S.A. during 1987-88.

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In the former studies of land classification based on expected farm income, the estimation of the expected farm income was imperfect or inadequate. Then in this paper, the method to calculate the expected farm income in the hamlet classification is studied.
Firstly, problems of the method with principal component analysis (the PCA method) in the hamlet classification were made clear. For example, farm income cannot be estimated directly in the PCA method. The first principal component standing for the farm scale is used as the classification measure correlated with farm income. Therefore, a method with multiple regression analysis (the regression method) as a method for resolving such a problem was presented. In this method, farm income is estimated with a regression equation.
Then, the regression method was applied to Tsukuba district (old Tsukuba town) in Ibaraki Prefecture. The objective of the classification is to find important hamlets for the promotion of agriculture in the district. Hence, the unit of classification is a hamlet. The measure of the classification is “seisan nogyo shotoku” per farm (farm net production). In this case, “seisan nogyo shotoku” per farm is applicable as the measure of the hamlet classification. The classification process is as follows: (1) The estimation of regression equation with data of the surrounding cities, towns, and villages (including old Tsukuba town); (2) The estimation of the “seisan nogyo shotoku” per farm of each hamlet in Tsukuba district with the estimated regression equation; (3) The classification of each hamlet in Tsukuba district based on the expected farm income which is correlated highly with the estimated “seisan nogyo shotoku” per farm.
Finally, the merits of the regression method were summarized.

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