Abe’s Toast to Putin Underscores Sake Sales Push in Japan

Photographer: Akio Kon/Bloomberg

Workers spread steamed rice on tables in a hot room where the rice is treated with a mold called "koji" in preparation for brewing sake at the Asahishuzo Co. brewery manufacturing Dassai-branded sake in Iwakuni, Yamaguchi Prefecture, Japan. Close

Workers spread steamed rice on tables in a hot room where the rice is treated with a... Read More

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Photographer: Akio Kon/Bloomberg

Workers spread steamed rice on tables in a hot room where the rice is treated with a mold called "koji" in preparation for brewing sake at the Asahishuzo Co. brewery manufacturing Dassai-branded sake in Iwakuni, Yamaguchi Prefecture, Japan.

Farmers on Japan’s west coast will sow Nihonbare rice this year for the first time in a decade as growers around the country return to older varieties to meet demand for record sake exports.

Overseas shipments of the traditional rice-based alcohol reached an all-time high of 8.5 billion yen ($80 million) in the 10 months through October as they headed for a fourth annual gain, the latest data from the Agriculture Ministry show. Farmers from Echizen in the west will produce 1,080 metric tons in 2014, the JA-Echizen Takefu agricultural cooperative said.

Suppliers to brewers are increasing acreage as Prime Minister Shinzo Abe targets a fivefold increase in exports of sake, rice crackers and other products made from the grain to 60 billion yen by 2020. That’s a boon for brewers including Takara Holdings Inc. and an opportunity for some farmers to switch from food rice as consumption falls in Japan amid more varied diets.

“Sake producers have become evermore aware of the importance of rice quality,” said Shunsuke Kohiyama, an export adviser at the Japan Sake and Shochu Makers Association. “They approach this like wineries in France getting the best grapes.”

Nihonbare was the most popular rice for eating in Japan until the 1970s, when it was overtaken by the sweeter and stickier Koshihikari grain. Brewers still favor the strain for its low protein count to produce dry-tasting sake.

Photographer: Akio Kon/Bloomberg

A bottle of Dassai-branded sake is arranged for a photograph at the Asahishuzo Co. brewery manufacturing Dassai-branded sake in Iwakuni, Yamaguchi Prefecture, Japan. Close

A bottle of Dassai-branded sake is arranged for a photograph at the Asahishuzo Co.... Read More

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Photographer: Akio Kon/Bloomberg

A bottle of Dassai-branded sake is arranged for a photograph at the Asahishuzo Co. brewery manufacturing Dassai-branded sake in Iwakuni, Yamaguchi Prefecture, Japan.

“It’s high-yielding and will help boost incomes,” said Sadahiko Yasui, assistant director at the cooperative. “Nihonbare also shows resistance to high temperatures and typhoons, and is relatively easy to cultivate.”

Prized Gift

In Abe’s home prefecture of Yamaguchi, Asahishuzo Co. is increasing production of top-grade daiginjo sake using Yamadanishiki rice, another vintage strain, said Kazuhiro Sakurai, the brewer’s executive vice president.

Asahishuzo prizes Yamadanishiki for its large grain and condensed starch core and used 2,400 tons last year to brew “aromatic and clean” sake, according to Sakurai.

Abe offered the closely-held company’s Dassai-labelled sake to French President Francois Hollande when he visited Tokyo in June, and to Russia’s Vladimir Putin on his 61st birthday.

Output of Yamadanishiki in Hyogo prefecture, where the variety was developed 90 years ago, increased to 15,796 tons in 2012 from 15,227 tons in 2011, according to the local government.

Sake exports to the U.S. reached 3.2 billion yen, or 38 percent of the total shipments of the alcohol, in the 10 months through October, data from the Agriculture Ministry show. Sales to the American market for all of 2012 were 3.25 billion yen. Shipments to Hong Kong were 1.3 billion yen in the same 10 months, compared with 1.50 billion for 2012.

Photographer: Akio Kon/Bloomberg

A worker stirs mash in a tank used in the fermentation process to make sake at the Asahishuzo Co. brewery manufacturing Dassai-branded sake in Iwakuni, Yamaguchi Prefecture, Japan. Close

A worker stirs mash in a tank used in the fermentation process to make sake at the... Read More

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Photographer: Akio Kon/Bloomberg

A worker stirs mash in a tank used in the fermentation process to make sake at the Asahishuzo Co. brewery manufacturing Dassai-branded sake in Iwakuni, Yamaguchi Prefecture, Japan.

Biggest Shipper

“Sales overseas are increasing with the popularity of Japanese food,” said Tomoko Sakaguchi, a spokeswoman for the sake unit of Takara Holdings.

Takara is the biggest seller of sake in overseas markets, where it shipped about 7.3 million liters (1.9 million gallons) from its breweries at home and abroad in 2012, Sakaguchi said.

The company, whose shares gained 43 percent last year while the benchmark Topix index surged 51 percent, hasn’t finished figures for 2013. The stock advanced 1.6 percent to 934 yen at 2:15 p.m. in Tokyo, snapping two days of losses, while the Topix Foods Index of 69 food and beverage companies fell 0.4 percent.

Food Exports

Abe aims to double food exports to 1 trillion yen by 2020. They slumped 8.3 percent to 451 billion yen in 2011 after the nuclear disaster in Fukushima prefecture turned overseas consumers away from Japanese produce.

Rice cultivated for sake brewing accounted for as little as 250,000 tons of the 8.6 million tons produced in Japan in 2013, according to data from the ministry and the sake association.

Japan needs to expand agricultural exports beyond premium products and this requires greater focus on increasing the efficiency of farms and cutting production costs, said Kazuhito Yamashita, research director at the Canon Institute for Global Studies in Tokyo.

In Echizen, farmers plan to expand Nihonbare output to as much as 5,400 tons by 2018, said Yasui of JA-Echizen. Planters in Yamagata prefecture will sow the century-old Kamenoo variety while growers on the northern island of Hokkaido are using Ginpu rice, developed in 1989, according to the Agriculture Ministry.

The addition last month of Japan’s traditional washoku cuisine alongside French food on UNESCO’s Intangible Cultural Heritage list may also help sake sales.

“The best alcoholic drink for traditional Japanese food is sake, without any doubt,” said Yoshihiro Murata, the chairman of Japanese Culinary Academy in Kyoto. “With 55,000 washoku restaurants abroad, if each one sells an extra bottle every night, sake exports could take off.”

To contact the reporter on this story: Aya Takada in Tokyo at atakada2@bloomberg.net

To contact the editor responsible for this story: Brett Miller at bmiller30@bloomberg.net

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