A Food Company's Entry into Fresh Tomato Production and Regional Effects: Kagome Co., Ltd.'s Entry into Mihara Village, Kochi Prefecture

<p>This study examined the process of a food company's cross-prefectural entry into agriculture and its regional effects on a Japanese rural area, focusing on the case of Kagome Co., Ltd. as a typical example of a large Japanese food company that has entered the agricultural area.</p><p>In Japan, the entry of large companies into agriculture across prefectures has increased rapidly since the early 2000s. Several researchers have called this trend “franchise-type agriculture,” meaning an agricultural production system independent of territorial relationships. Many large food companies (food processors and retailers) have entered into fresh vegetable production in the Hokkaido, Kanto, and Kyushu regions, where they can easily obtain vast amounts of farmland. However, Kagome entered fresh tomato production in the late 1990s, and some of its farms are located in disadvantaged areas including the Chugoku and Shikoku regions, indicating that the case of Kagome is worthy of study.</p><p>Kagome located its farms in many prefectures throughout Japan to disperse risk and enable year-round production of fresh tomatoes. Although it attached importance to climatic conditions and market access in deciding on farm location, solicitation efforts by local governments greatly affected its decisions. Most of Kagome's own farms in western Japan were the result of local government attraction activities. Mihara village in Kochi prefecture, the smallest municipality in Kochi, greatly increased its agricultural production by attracting a Kagome farm.</p><p>Therefore, this study examined in detail the effects on Mihara associated with Kagome's entry into the area. As Mihara had faced depopulation issues for a long time, it spent a significant amount of its budget on the construction of the Kagome farm. To receive a subsidy from Mihara and gain villagers' confidence, Kagome established an incorporated agricultural organization (“farm C”) by cooperating with a local celebrity. Due to the establishment of farm C, gross agricultural production and the employment of young villagers have grown in Mihara. However, farm C has no relationship with local farmers and agricultural cooperatives, and therefore it is difficult to escape the conclusion that the spillover effects of farm C on Mihara are minimal. Moreover, farm C hired the majority of its employees from municipalities outside Mihara to secure talented workers. This employment policy by farm C contradicts the policy of Mihara, which is to offer jobs to as many villagers as possible.</p><p>In conclusion, Kagome's entry into fresh tomato production has had a considerable effect on the regional economy of Mihara. However, these economic effects do not all accrue to the village itself. This shows that the recent rural development program of relying on “plant factories” promoted by the Japanese government does not always perform well.</p>