Fukushima fallout: Chinese consumers shun Japanese brands

What happened Just a week after Japan’s controversial decision to release treated wastewater from the Fukushima Daiichi nuclear plant into the Pacific Ocean, Chinese consumers are making their objections clear. While mainland China and Hong Kong have both instated official bans on seafood from Japan, netizens are calling for further boycotts against Japanese brands and other product sectors, such as beauty, signaling a fresh rift in already tense Sino-Japanese relations. The release of treated wastewater, which Japanese authorities insist has undergone rigorous treatment to remove most radioactive substances, was endorsed by the International Atomic Energy Agency (IAEA), whose testing has shown the water to be safe, with radiation “seven times lower than the global drinking water standard.” However, the move is still seen by many Chinese citizens as an environmental threat. China's Foreign Ministry expressed concerns over the decision, suggesting potential ecological repercussions for neighboring countries. Sales of Japanese beauty brands, traditionally popular in China due to their perceived quality, and products made for Asian skin types could be particularly hit. The Jing Take Since the news broke last week, several Japanese beauty brands have encountered resistance from consumers in China and South Korea. On Chinese e-commerce and social platforms like Xiaohongshu and Weibo, numerous users have compiled lists of Japanese cosmetic brands and offered up non-Japanese made alternatives. The incident has triggered Chinese citizens’ anger towards Japan at large, due to the two countries’ complex historical and political relationship. Some local science-fluent commentators have weighed in, partly echoing the IAEA’s findings, arguing that Japanese products made using local water should be safe. However, public sentiment is still negative and the topic is trending, with the hashtag #JapaneseNuclearRadiationProducts (#日本核辐射产品) on Xiaohongshu having now amassed 16 million views. Major Japanese beauty companies’ stock prices dropped during the immediate aftermath, with Shiseido marking its largest weekly drop in almost 10 months, down 6.8 percent, while BCL Company (owning brands like Saborino, Momo Puri and Tsururi) and Kosé Corporation (which owns Kosé, Sekkisei, Fasio and Visée among others) both declining by over 3 percent. Reports estimate that by 2027, China will account for about a sixth of the world’s beauty sales, which are forecast to hit around 96 billion (RMB 690 billion) annually. While retail analysts note that Chinese boycotts driven by nationalism or geopolitical tensions tend to be short-lived, they can have a big impact due to the huge size of the market. The Sino-Japanese dispute over the Diaoyu/Senkaku islands in 2012 saw this effect emerge, when China sales of Japanese autos and other products declined temporarily. This means that Japanese brands in China will need to be on high alert. The public relations hurdles will be significant, and many might consider direct campaigns to address these consumer concerns. With global economies still reeling post-pandemic, a prolonged boycott could spell disaster for some businesses. However, there is speculation as to how much a downturn would affect direct sales. Japan’s international tourism is in recovery, with Chinese visitors numbers only second to Brits. The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

Fukushima fallout: Chinese consumers shun Japanese brands

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Published August 28, 2023

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Fukushima fallout: Chinese consumers shun Japanese brands