Big Financial Problems For The Whale Slaughtering Institute Of Cetacean Research Japan

“Japan's research whaling now facing problems at home”

Japan's research whaling has long been criticized from around the world as commercial whaling in disguise. Now, research whaling faces a domestic blow--stagnant sales of whale meat.

A series of accidents involving whaling ships last year and disruptive protests from overseas activists have also hurt the finances of a government-affiliated foundation in charge of research whaling.

The problems have become so big that the Institute of Cetacean Research, an outside body of the Ministry of Agriculture, Forestry and Fisheries, is struggling to pay back its interest-free loans to the government. The institute received a total of 3.6 billion yen in interest-free operational loans from another government affiliate, the Overseas Fishery Cooperation Foundation, in fiscal 2006.

The International Whaling Commission banned commercial whaling in 1986, but the whaling convention allows Japan to catch whales for scientific research.

According to the foundation's settlement of accounts for fiscal 2006, it failed to pay back about 1 billion yen of the loan package. The institute had planned to repay all of its debts by the end of July last year, but the government allowed it to repay the loans in instalments over four years from fiscal 2007.

The institute first received a public loan package of 1.2 billion yen in its fiscal 2001 accounting year when the quantity of whale catches increased. It supplied 2,450 tons of whale meat to the domestic market in fiscal 2000 and 2,620 tons the following year.

The amount supplied to the market gradually increased to a high of 5,560 tons in fiscal 2005, and the annual amount of loans correspondingly rose to
3.6 billion yen in fiscal 2005 and 2006.

Aiming to strengthen "ecological research," the institute increased the research whaling quota to 850 catches in the season covering 2005 and 2006, compared with 440 in the previous season.

The amount of whale meat supplied to the market jumped by 30 percent over the same period, and the institute, which does not aim to make a profit, cut the price of whale meat by 20 percent.

The lower price, however, reduced revenue from whale meat by 6 percent, institute officials said. Meanwhile, the cost of whaling rose by 10 percent because the institute increased the number of whaling vessels from five to six to meet the higher quota.

One institute official acknowledged that the 20-percent price cut was "too much" when operational expenses are taken into account. In the institute's settlement of accounts for fiscal 2006, it posted a loss of 700 million yen. It also did not provide reserve payments to the government that had previously amounted to tens of millions of yen annually.

Officials of the institute and the fisheries ministry said a fire and other accidents involving whaling vessels last fiscal year contributed largely to the loss. They said the institute should be able to balance its budget this fiscal year.

Escalating protests by activists against Japanese whaling vessels forced them to suspend operations in January.

While whaling resumed soon afterward, further protests by activists could suspend operations anew. If that happens, the supply of whale meat may be reduced, further hurting the institute's budget.

The Tokyo-based research whaling company Kyodo Senpaku was formed in 1987 by consolidating whaling departments of Japanese fisheries companies. Due to the global protest against whaling and waning profitability, three major fisheries companies withdrew from Kyodo Senpaku's operation in 2006. 

The company became a publicly supported whaling monopoly, whose purpose is to maintain Japan's whaling tradition. Kyodo Senpaku is a for-profit company that collects, processes and sells wholesale whale specimens on behalf of the research institute.

In the year that ended in October 2007, Kyodo Senpaku recorded sales of 6 billion yen with a net profit of 5 million yen.

Most of the revenue came from commission fees on sales of whale meat to wholesale markets and charter fees of its whaling vessels paid by the institute.

One problem facing the company is its difficulty in recruiting young workers willing to stay long enough to learn whaling skills.

In addition, the long and distant voyages are a turn-off for young people,
company officials said.          

Critics have questioned the government's policy of maintaining the country's whaling tradition at any cost when it faces a huge financial deficit and other problems.

By Kenji Oyamada, The Asah Shimbun