TOKYO, JAPAN / RankWire.AI / – In July 2026, Japan achieved record-breaking trade figures for both imports and exports, driven by rising energy costs and strong semiconductor demand, which boosted overall trade values. Imports surged 27.8% compared to the previous year, reaching approximately 12.15 trillion yen. Exports grew 23.2% to around 11.51 trillion yen. According to the Ministry of Finance, imports expanded at a faster rate than exports, resulting in a trade deficit of 634.5 billion yen for the month.
This month marked the second consecutive record-high for imports by value. The rise was significantly influenced by crude oil as Japan grappled with increased energy expenses. Crude oil imports increased by 5.5% compared to July 2025, ending a three-month stretch of declining year-on-year volumes. The total value of crude shipments soared by 87.8% over that period. As Japan remains heavily reliant on imported energy, fluctuations in oil prices and exchange rates continue to be key factors shaping its merchandise trade figures.
Exports also reached an all-time monthly high, maintaining an 11-month streak of year-on-year growth. The 23.2% rise followed a 19.3% increase in June. Demand for semiconductor products stayed robust, supported by investments related to artificial intelligence and data centres. A weaker yen contributed to higher yen-denominated overseas sales and helped make Japanese exports more attractive to some foreign buyers. The export growth rate surpassed the previous month’s pace, highlighting ongoing momentum.
Semiconductor Sector Bolsters Japan’s Export Performance
Trade with Japan’s top two export destinations saw significant growth in July. Exports to the United States climbed 22.0% from a year earlier, reaching about 2.09 trillion yen, while shipments to China increased 25.8%, amounting to roughly 2.01 trillion yen. These upward trends were fueled by increased global expenditure on semiconductors, electronics, and AI infrastructure, supporting demand for Japanese industrial goods. Japan’s sizable manufacturing sector in electronic components, machinery, and vehicles accounts for a substantial part of its international merchandise exports.
Data from the Ministry of Finance indicated a shift from the first half of 2026, when export growth had outpaced import growth overall. From January to June, customs exports rose 13.7% year-on-year. Meanwhile, imports grew more slowly during this period, with electronic components and semiconductor exports among the strongest contributors. However, July saw a reversal of this trend, as the faster increase in import values pushed Japan back into a merchandise trade deficit.
Rising Energy Costs Contribute to Record Import Bill
Japan’s July trade data also reflected the impact of rising crude oil prices on an economy heavily dependent on energy imports. The sharp jump in the value of oil imports was driven more by price increases than physical volume growth. This disparity helped push the total import bill to a second consecutive record high. The weak yen further amplified costs for goods priced in foreign currencies, and imported energy remained a crucial component of Japan’s overseas purchases.
These record trade values coincided with sustained overseas demand for technology-related exports. During the April-June quarter, exports helped support the economy, which grew at an annualized rate of 1.1%. The July figures confirmed that international demand remained strong at the beginning of the third quarter. At the same time, the 634.5 billion yen deficit underscored how rising import costs outpaced export gains, preventing Japan from closing the trade gap despite record export figures.