What’s more, the average farm size, at just under two hectares (approximately five acres), is far too small to achieve a lucrative economy of scale.
It is for these and related reasons that many cultivators are quitting farming and even abandoning their farmland. By our calculation, abandoned farmland in Japan now totals roughly one and a half times the size of metropolitan Tokyo — a politically unacceptable level given Japan’s relative scarcity of arable land.
JA has long been an impediment to the resolution of these problems. Its purchasing and marketing division jacks up cultivation costs by charging inflated fees and commissions. JA also goes out of its way to keep inefficient small-scale, part-time farmers in business, not least because they comprise the bulk of farmer-member demand for JA services. It should come as no surprise that as the Abe government confronted the myriad problems of the farm sector, it set its reformist sights on JA.
Japan’s agricultural crisis has festered for nearly a generation. That it has triggered co-op reform now is testament to the recent expansion of political opportunities for change. The ‘iron triangle’ among sympathetic Liberal Democratic Party (LDP) Diet members, bureaucrats in the Ministry of Agriculture, Forestry and Fisheries, and JA executives that dominated postwar policymaking in defence of the agricultural status quo has been steadily breaking down. And in the wake of past electoral reforms, the ability of JA to exchange votes for political favours has shrunk. These and other developments have facilitated Abe’s efforts to seize the initiative and push through co-op reforms that would have been unthinkable even a decade ago.