Convenience store chains Lawson Inc. (2651) and Seven & I Holdings Co. (3382) are so sure Japan’s aging farmers can’t meet demand for fresh vegetables that they’re investing in cropland and training young people to work the fields.
Takeshi Niinami, who heads an agricultural reform committee advising Prime Minister Shinzo Abe and is the chief executive officer of Lawson, the nation’s second-largest operator, started 12 farming joint ventures since 2010 and plans 28 more.
He’s expanding as Abe cuts subsidy payments to food-rice growers and creates land banks to consolidate small holdings into large tracts that can be leased by companies as older farmers put down their plows. The prime minister has also floated the idea of establishing special economic zones this year, which could test majority corporate ownership of farmland, something that’s blocked by current laws.
“Farm output will keep falling unless we take action,” said Yayoi Sugihara, a spokesman for Lawson in Tokyo. “We want to bring on young farmers to become professional producers.”
For Lawson, Seven & I’s 7-Eleven outlets and Itochu Corp.’s partly owned FamilyMart Co., a growing appetite for fresh fruit and vegetables means more frequent customer visits. Lawson estimates shoppers who drop in to buy perishable items visit its stores about twice as often as others and spend 20 percent more.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.