This paper investigates the impact of liberalization of the orange trade on Japanese mandarin-producing which is one of the major sectors of Japanese agriculture.
The problem about liberalization of the orange trade, which was a long-pending problem between Japan and the U.S., came to a conclusion in 1988. This conclusion gave rise to two big changes in mandarin agriculture in Japan.
First was the conversion of agricultural policy after 1988. The main purpose of previous policy was promoting mandarin-areas. But after 1988, its purpose changed to promote strong agricultural management which could overcome international competition with foreign oranges in the Japanese market. Concretely, for fresh oranges, the Japanese government distributed subsidies for famers who discontinued their own mandarin orchards in bad location. As a result, mandarin growing decreased greatly and the quality of mandarins was improved. Therefore, though the liberalization of the orange trade was enforced in 1991, the quantity of imports didn't increase greatly and the Japanese mandarin market wasn't taken away by foreign oranges. For orange juice, government decreased the conpensation money for industrial mandarins. This measure discouraged farmers from producing primarily industrial mandarins.
Second were the financial difficulties of juice factories established by agricultural cooperrative associations, after 1991. This was a result of the quantity of import orange juice increased rapidly and took away mandarin juice to market in Japan. Therefore, juice factories reduced the purchase quantity of industrial mandarins from farmers and caused the price of industrial mandarins to fall year after year, because the stocks of mandarin juice increased at the factory. Consequently, the liberalization of the orange juice trade exerted more impacts on Japanese mandarin-producing areas than the fresh orange trade.
These problems clearly appeared in Tanbara Town, in Ehime Prefecture, which is the example district in this paper. In Tanbara Town, the production of industrial mandarins account for more than 50per cent of all mandarins. Tanbara Town has one of the highest rates in Japan. The industrial mandarins were roughly grown by farmers who have other jobs or only by the aged. In these conditions, the liberalization of the orange juice trade was enforced. The price of industrial mandarins fell and the purchase quantity of industrial mandarins decreased at the factory more than previously. So the farmers' profits decreased more and more, and they gave up harvesting mandarins. Therefore, many abandoned orchards have appeared one after another in recent years. The growth of abandoned orchards made the growing environment worse and full-time farmers lost their will to produce mandarins. This is the most important problem in Tanbara Town.
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