Why Japan Start-Ups Are Producing ‘Tree Sake’ to Meet $9B Demand

If successful, Japanese producers aim to provide global production of cedar-based sake by 2025.

Mon 02 Oct 23


Japan is now producing sake from trees, with the government currently working with start-ups to commercialise cedar-based technology.

The breakthrough is a byproduct of the 2011 Fukushima Daiichi nuclear power plant and is part of a new fragmented discovery.

Considered a sacred beverage, sake—the fermented rice-based alcohol—throughout its 2,000-year history, it has become Japan’s national beverage. 

With an international market valued in 2019 at US $9.2 billion, sake is going global and, in 2022, was named as a serious contender for the world’s next spirit of choice.

As reported in The Mainichi, the Forestry and Forest Products Research Institute (FFPRI) has devised a manufacturing process similar to making shochu, using fermentation technology to create new flavours. 

The FFPRI is the Japanese Government research organisation focused on conducting interdisciplinary research on forests, forestry, the timber industry, and tree breeding. 

Following a Japanese Government to reduce incidences of pollen, the FFPRI is now looking to better utilise the country’s vast cedar resources.

The surge of cedar trees in Japan can be traced back to the post-World War II economic boom when large-scale reforestation efforts were undertaken.
The surge of cedar trees in Japan can be traced back to the post-World War II economic boom when large-scale reforestation efforts were undertaken. (Photo Credit: Pixabay)

Known as ‘Wood Spirits,’ it now supports start-ups looking to invest extensive capital to set up commercial production facilities as part of a greater push to increase commercial production to meet Japanese demand for forest and wood products.

One of the start-ups commercialising the research is Ethical Spirits, a venture company opening the world’s first distillery focused on cedar production.

The company has started production after obtaining a permit from the government and will increase output whilst keeping an eye on the reaction from the market. 

If successful, it aims for global production of cedar-based sake by 2025.

Ethical Spirits uses four types of trees in its distilling process: cedar, cherry, mizunara (Quercus crispula), and kuromoji (lindera umbellata). 

Each tree has a different flavour when distilled, with the company expected to bring wood chips from Tokigawa in Saitama Prefecture and bottle the finished sake at a new distillery partly constructed in Chiba City.

According to Yuichiro Otsuka, a researcher at the FFPRI who was involved in the development, aside from the taste of alcohol, when the sake is in the mouth, the scent of each tree penetrates the nose.

It’s also possible to mix the final product with fermented but not yet distilled liquid to enjoy the aroma and colour. 

“For example,” Mr. Otsuka said, “the fermented cherry tree liquid is bright red, but if you mix a little of the distilled sake, it becomes pink. Then it’s exactly the colour of cherry blossoms.”

Mr Otsuka said that until now, the sugar in the trees required for the alcohol fermentation could not be extracted without “the use of strong chemicals, which made it impossible to produce alcohol safe for drinking.”

But in the wake of the 2011 accident at the Fukushima Daiichi nuclear power plant triggered by an earthquake and tsunami, a non-chemical fermentation method was found while attempting to produce methane gas from biomass, including wood containing radioactive substances.

The FFPRI then discovered that the method could be used to produce alcohol safe for human consumption and set about exploring its potential for commercialisation.

The newly discovered “wet-milling” production method, developed in 2018 and patented in 2021, makes the sake by pulverising wood to less than a thousandth of a millimetre, which releases natural sugars.

Equipment for pulverizing wood into mash is pictured at the Forestry and Forest Products Research Institute in Tsukuba, Ibaraki Prefecture, in August 2023. (Photo Credit: Kyodo)

The wood is mixed with water to break it down into mash using industrial equipment refitted. The sugar created by adding enzymes to the microparticles is fermented with yeast and distilled.

A machine specially designed to produce the sake can make about 750 millilitres of distilled liquor, equivalent to a bottle of whiskey, from cedar weighing about 2 kilograms. 

Using a larger machine, start-ups like Ethical Spirits can produce at least 50 bottles of the product a week, which is expected to grow with greater commercialisation.

“We can also utilise unused timber left over from forest thinning (post-forest harvesting),” according to Kazuya Tatsumi, the Chief Operating Officer for Ethical Spirits.

“I feel there’s potential in this new category of liquor. If we can make sake with the trees of the world, there will be an infinite number of combinations, and it is worth the challenge.” 

The FFPRI says that if domestic businesses with brewing licenses use domestic timber, they will be allowed to use the patented technology.

New market entrants will be offered training in a dedicated research building.

So far, four companies, including Ethical Spirits, have signed contracts, with the estimated cost of the equipment between 200 to 300 million yen or AU $1.5 to $2.5 million.

Given there are about 1,200 species of tree in Japan, however, a variety of tree-based sake flavours are possible, according to Mr Otsuka.

“If we can take advantage of subsidies from the national and local governments, we can open the way to the realisation of this project…We would like to create new value for timber with people interested in this project,” Mr Otsuka said.


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