Japanese Seafood Producer 'onshores' Amid Rising Costs, Global Risks

Japanese seafood producer 'onshores' amid rising costs, global risks

A Japanese seafood company, whose supply chain stretches across the Pacific Ocean and runs through Asia, has decided to bring home a big part of its production.

Yamaya Communications is planning to have all the products it sells in Japan to be made in the country.

The Fukuoka-based firm has been making "mentaiko," a spicy Alaska Pollock roe, for nearly half a century. The company began outsourcing parts of the production about 40 years ago.

Most of the fish is caught in the Bering Sea off Alaska. Then it's processed on fishing boats as it's transported to Busan, South Korea. From there, it is shipped to Vietnam, where it is salted.

The company now says that last stage will be done back in Fukuoka at an automated plant next April. A major reason for the "onshoring" is costs. Local workers are being paid more. A weaker Japanese yen compounds the company's financial burden.

Yamamoto Masahide, President of Yamaya Communications, says, "The gap in labor costs between Japan and overseas has narrowed over the past 20 years. Supply-chain disruptions amid the coronavirus pandemic are another factor."

He believes that onshoring will spread among other Japanese companies, due to an increased risk of disruptions to global supply chains.