Morinaga Milk Industry is one of Japan’s leading dairy companies. Founded in 1917, it first supplied condensed milk to its parent company Morinaga & Co. The company was reorganised in 1949 when the name Morinaga Milk Industry Co Ltd was first used, and now offers a complete range of dairy and non-dairy products.
Headquartered in Tokyo and employing over 5,700 people in the group, its annual sales have grown to ¥591bn. In addition to its affiliated companies, it has 18 of its own production facilities across Japan, which manufacture the large variety and volume of products it currently sells. The company also has several joint venture and subsidiary companies outside Japan.
Dr Fumiaki Abe: The Japanese dairy market is worth around ¥2.1tn and represents around 5.7% of the country’s total food market. Although the market overall is flat and milk consumption is declining, there is growth in added value categories such as yogurt and milk beverages such as chilled coffee drinks.
Japanese consumers are demanding and health-conscious, and for many of them yogurt equals probiotics. As a result, most dairy companies in Japan are producing original yogurts containing probiotics or functional ingredients with appealing health benefits. Morinaga’s Bifidus yogurt supplemented with BB536 has been popular in Japan since 1978.
Dr Fumiaki Abe: Morinaga’s philosophy is to offer consumers nutritionally sound, good-tasting products based on the beneficial components found in milk.
We have a wide range of product lines, from chilled and non-chilled beverages including milk, milk-based beverages and a variety of juices, ready-to-drink tea, coffee and soft drinks, chilled and frozen desserts including ice cream, gelatin desserts and fruit yogurts, traditional cheese, butter and standard yogurt products, a large variety of powdered infant formulas, some of which have been formulated for infants and children with special dietary needs, baby food, clinical foods, and finally pharmaceuticals, which represent a small segment but offer great growth potential for us.
We have a number of household name brands in Japan across all our product lines. These include Bifidus probiotic yogurt, Paltheno Greek yogurt, Café Latte chilled café au lait, Pino and Parm Ice cream brands, Creap creaming powder, Caldus probiotic milk, Hagukumi infant formula and E-Akachan HA milk formula.
We also produce under licence Sunkist fruit juice, Kraft cheese, and Lipton tea beverages. We probably launch over 1,000 new product items each year. Morinaga also produces as part of its B2B business functional ingredients – probiotic powder, lactoferrin and milk peptide – for food and health food companies.
Dr Fumiaki Abe: Our brands are key to our success. For us, that means strong brands built on functional ingredients and unique technologies. Therefore, innovation in these areas is critical. We have six research and information centres in Japan, and the Food Science & Technology Institute that I manage conducts basic research in microbiology, molecular biology, protein chemistry and separation technology applied to unique food ingredients.
Dr Fumiaki Abe: Morinaga has four key areas of functional ingredients and related technologies: Probiotics, Lactoferrin, Milk peptides and Lactulose (Prebiotics). These functional ingredients have led to the development of innovative products such as probiotic yogurt, probiotic milk and infant formula supplemented with each of these. Examples include:
Dr Fumiaki Abe: In addition to our ingredients, many of our products have innovative product designs. Our unique ice cream brand Pino contains very small, bite-sized pieces of ice cream covered in chocolate. We make our Creap creaming powder for coffee with 40% milk fat rather than plant fat using our powdering technology, which means it dissolves very easily.
Dr Fumiaki Abe: Japanese consumers are increasingly interested in their health, and food-induced health is very popular. Consumers are knowledgeable and believe that lactic acid bacteria including bifidobacteria is effective on gut and immuno health and this is why the yogurt market in Japan is still healthy.
The trend of zero and low fat has also extended to yogurts. Morinaga launched a zero fat yogurt in 2008 and now produces a low calorie ice cream with only 100kcal per pack.
The economic situation in Japan means that consumers are always looking for the best value. The increasing number of supermarket own-label brands dictates that we compete based on the originality of our brands and technologies, and on the functionality of our ingredients.
Dr Fumiaki Abe: Currently, we export and produce a range of consumer products outside Japan, including infant formulas and tofu. We also sell our functional ingredients to markets in Europe, US, Canada and Asia. In particular, we believe that our Bifidobacterium longum BB536 and B. breve M-16V are competitive with the other Bifidobacterium strains being used around the world because they are human species and documented strains supported by more than 70 clinical studies.
Dr Fumiaki Abe: Responding to Japanese consumers who are very interested in their health and developing products based on strong science has given Japanese companies such as Morinaga experience in innovating and developing new science-based products. Recently, in Japan, we have even seen Kirin’s FOSHU ‘fat-absorbing’ Mets Cola becoming very popular for its health benefits.
However, Japanese dairy companies do not have a history of good technologies in cheese. Despite becoming popular now in Japan, most of the cheese sold here is imported from Europe, US, Australia or New Zealand. There are opportunities for Japanese companies to learn from their western counterparts about cheese technologies for natural and processed cheese.
Dr Fumiaki Abe: Japan is already facing the serious concerns of a rapidly ageing population and a very low birth rate. More than 30 million people are over 65 years old. We have to address the health of this ageing population through food, in particular providing essential nutrients such as protein or calcium, which are helpful in combating mobility problems.
Obesity, cancer, high blood pressure and diabetes will also move up the agenda. Many consumers will focus on functional ingredients that address these concerns.
Because the Japanese government wants to limit the cost of medical care, the development of healthy products such as those with FOSHU (Food for specified health uses) accreditation will be recommended. We believe that the area of clinical nutrition will become increasingly important because of this ageing population.
Morinaga is the number one clinical nutrition food company in Japan and we plan to put a great deal of effort into this sector over the coming years.
We hope to provide innovative products for the ageing population through a combination of clinical nutrition and functional ingredients. These technologies will of course be useful not only in Japan but on a worldwide basis, as other countries face this same situation in the near future.
FoodBev Media Ltd 2015