Meiji Food Materia: pioneering functional ingredients for a healthier future.

One of the major challenges facing Japan and its businesses is the declining population. Not only is Japan the most ageing country in the world, but its population is also declining due to a falling birth rate. This creates a double pressure: a continuing labour shortage and a shrinking domestic market. From your perspective, how is your company responding to these challenges? To what extent do you think Japanese companies need to think beyond their domestic borders to ensure long-term business success?

The decline in the workforce is a major challenge for our company. For this reason, we are actively creating opportunities for our senior employees to remain active after retirement. This year, the Meiji Group introduced a retirement matching system to enable employees approaching retirement age to utilise their knowledge and skills in jobs that suit their own lifestyles. In addition, seminars and workshops are held for employees in their 50s to support their post-retirement career planning, helping them to draw up their own career plans. By utilising the experience and know-how of the senior generation, we aim to revitalise our human resources and strengthen our business.

At the same time, they are adopting automation technologies such as digital transformation (DX) and AI to improve operational efficiency and reduce the workforce. However, for long-term growth, it is also essential to expand into new overseas markets and acquire the human resources to support this expansion. Asian markets, in particular, offer significant opportunities for Japanese companies due to their high growth potential.

International expansion not only gives access to new markets, but also fosters a multicultural work environment and enriches a company's core assets and competencies. In today's globalised world, companies need to embrace internationalisation and establish themselves as global players, rather than remaining purely domestic companies. This is why the Meiji Group is committed to recruiting diverse talent from different backgrounds and cultures. We firmly believe that the best way for companies to grow and evolve is to engage with new people, ideas and cultural perspectives.

We also attach great importance to partnerships with start-up companies and overseas academic institutions, incorporating these into our corporate strategy and strengthening our overseas expansion as an important pillar of our long-term growth vision.

The sugar industry faces a number of challenges, including supply chain disruptions and price volatility. In Japan, this problem is further compounded by demographic factors such as the ageing of the farming population, with an average age of around 65 years. Furthermore, in September 2024, global sugar prices soared by 10% due to declining production in key supplier countries such as Brazil and India. Given these supply and price fluctuations, what strategies are you implementing to mitigate these risks and ensure a stable and reliable supply of sugar?

Indeed, fluctuations in the global sugar market are a challenge. However, in Japan, sugar prices are managed independently of international price fluctuations through a government regulatory framework, which contributes to price stability in the domestic market.

Nevertheless, the ageing of the farming population is an increasing concern. In Japan, sugar production is mainly concentrated in Hokkaido, Okinawa and Kagoshima, but overall production is declining as farmers retire. This change has led to consolidation, restructuring and oligopoly among Japanese sugar producers, and ongoing transformation within the industry. We are closely monitoring these trends, assessing their long-term impact and adjusting our strategies to ensure the stability and sustainability of the industry.

Around the world, there is growing awareness of the health risks associated with excessive sugar consumption. As the obesity pandemic continues, consumer preferences are shifting towards healthier alternatives, increasing the demand for plant-based sweeteners. In response, food and beverage manufacturers are incorporating these alternative sweeteners into their products in line with changing market trends. How is your company adjusting its product range to meet the growing consumer demand for healthier sweeteners ?

Excessive sugar intake has been linked to a range of health problems, including obesity, diabetes, cardiovascular disease, tooth decay and even increased risk of cancer. Although Japan is still catching up, the move towards sugar reduction and alternative sweeteners is rapidly gaining momentum worldwide.

In response to this situation, we have developed a fructooligosaccharide, Mayoligo®, which acts as an alternative to sugar and is a health functional material. Mayoligo® does not affect blood sugar levels and is low in calories, making it an ideal sweetener for health-conscious consumers. It is widely used in dairy products such as yoghurt and powdered milk, and Meiji Co. also uses it in chocolate and ice cream.

We see tremendous growth potential in this sugar substitute and have already expanded its reach globally. Together with our partners, we currently supply more than 20,000 tonnes per year and demand continues to increase as more consumers and manufacturers seek healthier sweetener options. As awareness of sugar-related health risks increases, we expect demand for Mayoligo^R to grow further.

Mayoligo® is just one example of the innovative research being carried out by Meiji Food Materia. Can you talk a little about your current research activities, particularly in the area of functional ingredients? Health Are you working on any new developments or breakthroughs to meet the growing demand for health oriented food solutions?

Our current research and development is focused on improving consumer health, with a particular emphasis on gut health. By activating bifidobacteria and other beneficial gut bacteria, we develop solutions that promote a healthier lifestyle.

What sets our functional ingredients apart is their ability to strengthen the intestinal microflora. This improves mineral absorption, reduces the risk of lifestyle-related diseases such as obesity and diabetes and strengthens the immune system. Furthermore, new research suggests a strong link between excessive sugar intake and mental health problems such as depression and stress. Our unique prebiotics, probiotics and other gut-active ingredients address these issues by increasing short-chain fatty acids such as acetic, propionic and butyric acids, thereby contributing to the gut environment and overall health.

We are currently conducting several clinical trials to validate our research. One of our most notable innovations is Profec®, a new type of prebiotic developed through extensive collaboration across the Meiji Group. Unlike conventional oligosaccharides, Profec® activates and multiplies bifidobacteria in the gut through a unique mechanism of action, supporting a healthy digestive system.

Beyond our own research, we actively collaborate with national and international academic and research institutions and work with leading experts to develop cutting-edge technologies and functional ingredients to further optimise gut health and overall wellbeing.

Your company is uniquely positioned within the Meiji Group to utilise its own extensive trading capabilities. How do you utilise these capabilities to expand your B2B business and create opportunities for global growth?

The strength of Meiji Food Materials' trading company function is its ability to source high-quality raw materials and products from external suppliers and supply them to Japanese companies. As a trading company, we act as a B2B bridge between global suppliers and domestic companies.

In addition to the food sector, the survey found that the company is also active in the development of bio-cleaning products. We are using our expertise in bacteria to create solutions that not only clean but also deodorise. What made you decide to apply your research to bio-cleaning products ? Are you also looking for ways to utilise your unique technologies and raw materials beyond cleaning?

The bioproduct BNCLEAN^® is closely related to the work of BN1001 bacteria (BN bacillus). Its origins date back to 1946, when the Meiji Group established a pharmaceutical research department with the aim of developing antibiotics and antibacterial agents such as penicillin. In the course of its research, the company discovered BN bacteria, which have the unique ability to break down organic matter, particularly oil. Taking advantage of this, the company developed and launched BNCLEAN^® , a bio-cleaning agent made from naturally occurring bacteria.

The uniqueness of BNCLEAN^® is that, unlike conventional chemical cleaners, it harnesses the power of micro-organisms to clean surfaces. This makes it a safer and more sustainable alternative and is widely favoured by consumers and businesses seeking environmentally friendly solutions. Bio-formulations take longer to activate than chemical-based cleaners, but their effects last longer, and BNCLEAN^® has already proven to be highly effective, being used in a variety of sectors including homes, schools, stations, public transport and even sewage treatment plants. As the demand for environmentally friendly cleaning solutions continues to grow, so does interest in BNCLEAN^® .

However, as BNCLEAN^® is derived from bacteria, it is subject to export restrictions, particularly in Europe, which has strict regulations on products derived from bacteria. bnclean^® is currently only available on the domestic market, but the company is actively exploring the possibility of expanding overseas and introducing similar biocleaning concepts to other markets. The company is actively exploring the possibility of expanding abroad and introducing similar bio-cleaning concepts to other markets.

BNCLEAN^® (BN Bacteria) has great potential in the agricultural sector beyond cleaning applications. Research has shown that BN bacteria can stimulate plant growth and reduce the risk of root diseases. With this in mind, we are now looking to expand into the agricultural and sustainable farming sector, applying our expertise in bacterial technology to new areas in line with global sustainability initiatives.

What is your future global partnership strategy? What are the main objectives and criteria you consider before partnering with potential partners?

Our Mayoligo® is produced in cooperation with Samyan Corp in South Korea and is well established in Asia and Oceania. In North America, it is produced by Ingredion and in Europe by Beghin Meiji, a joint venture established with Tereos in France. The business is conducted under the respective product brands. Internationally, Mayoligo® is marketed for both human and animal consumption, including pet and animal feed applications.

When evaluating potential new partnerships, we focus on three key criteria. First, our ideal partner is a technology-driven company with strong R&D expertise. The development of fructooligosaccharides, particularly Mayoligo®, requires extensive scientific knowledge, and we favour companies that can conduct evidence-based research and provide robust data to support product development and application.

Secondly, a strong sales and marketing infrastructure is essential. We seek partners with established distribution channels and the ability to effectively develop target markets and ensure broad adoption of Mayoligo®.

Third, given the complexity of Mayoligo® production, partners must have a stable sugar supply network and high quality assurance (QA) production facilities to maintain consistent production standards.

Adherence to these standards will enable the partnership to drive sustainable growth and innovation and expand the global reach of Mayoligo® while maintaining the highest standards in scientific development, production and market impact.

An important step in your company's international expansion was the establishment of a subsidiary in China. How do you intend to utilise the subsidiary to achieve your future growth plans and broader business objectives?

The Chinese market used to be our largest sales market, but demand has decreased due to several factors. The fact that our competitors offer fructooligosaccharides at considerably lower prices, as well as the economic slowdown and declining birth rate in China, have affected our sales in this region. We do not expect this situation to improve in the foreseeable future. However, we see great potential in the Asian market in general and in emerging markets in particular.

For example, demand for Mayoligo® products remains strong in Vietnam, where, following the 2008 melamine incident involving powdered milk from China, there has been a growing interest in food safety, especially trust in Japanese ingredients. As a result, Mayoligo® has become a reliable source of fructooligosaccharides in many emerging countries and is gaining popularity. In view of these trends, the company is actively strengthening its presence in the region, where continued growth is expected.

To expand our global reach, we are implementing five key strategies. First, we will continue to drive research and innovation in gut activation. Second, we differentiate our products and make them stand out in the market by highlighting their health benefits. Third, secure intellectual property rights and patents to protect innovations. Fourthly, we will obtain accreditations and certifications in foreign markets to increase consumer confidence. Finally, we will focus on obtaining further scientific evidence to demonstrate the health benefits of fructooligosaccharides.

Fructooligosaccharides are our core product, but we are also continuously developing and exploring new functional ingredients. If our research leads to new discoveries that are beneficial to health, we are committed to commercialising them and bringing them to market.

As President of Meiji Food Materia, what legacy do you hope to leave behind by the time you are ready to hand over the company to the next generation of executives? What are the key achievements you would like to achieve to ensure the company's continued success and impact on the industry?

I took over as President in 2021, right in the middle of the Corona disaster. Our sales had grown steadily until 2019, but in 2020 we suffered a significant decline. My primary mission as President was to lead the recovery from that decline and to ensure future growth through expansion into new areas.

Although the transition will be gradual, it is clear that the sugar industry as a whole is in decline. It is therefore essential to develop and establish alternative sweeteners that are practical alternatives for both consumers and businesses. My challenge is to shift the focus to innovative functional ingredients that offer healthier and more sustainable solutions while maintaining sales of sugar-related products.

As a research-driven company, we have positioned functional materials as an important pillar of our business and my goal is to further strengthen and expand this area. Over the past few years, my mission has evolved beyond mere reconstruction. It is now to transform Meiji Food Materia into a truly global company, leading innovation in food science and contributing to healthier lifestyles around the world.