TOKYO, JAPAN / RankWire.AI / – In July 2026, Japan’s trade figures hit new highs for both imports and exports, driven by rising energy costs and demand for semiconductors that boosted trade values. Imports increased by 27.8% from the previous year to approximately 12.15 trillion yen, while exports grew by 23.2% to about 11.51 trillion yen. Data from the Ministry of Finance indicated that imports outpaced exports, resulting in a trade deficit of 634.5 billion yen for the month.
This month marked the second consecutive time that Japan recorded a monthly high in import value, with crude oil playing a significant role as energy expenses increased. Crude oil imports rose 5.5% compared to July 2025, ending a three-month period of year-on-year declines, while the total value of these imports surged by 87.8%. Japan’s heavy reliance on imported energy makes fluctuations in oil prices and exchange rates key factors influencing its trade statistics.
Exports also set a new monthly record and continued their streak of year-on-year growth for the 11th month in a row. The 23.2% rise followed a 19.3% increase in June. Demand for semiconductor products remained robust, bolstered by investments linked to artificial intelligence and data centers. A weakening yen increased the yen value of overseas sales and made Japanese exports more affordable for certain international buyers. Overall, export growth exceeded that of the previous month.
Semiconductor demand boosts Japan’s exports
Trade with Japan’s two largest export destinations surged in July. Exports to the United States increased by 22.0% year-on-year to about 2.09 trillion yen, while shipments to China climbed 25.8% to roughly 2.01 trillion yen. These rises coincided with global spending growth in semiconductors, electronics, and AI-related infrastructure, supporting demand for Japanese industrial goods. Japan’s extensive manufacturing sector includes electronic components, machinery, and vehicles, all significant contributors to its export revenue.
The Ministry of Finance’s data showed a shift compared to the first half of 2026, when overall export growth had already outpaced imports. Between January and June, customs-based exports increased by 13.7% from the previous year, with imports rising more slowly. Notably, electronic components and semiconductor exports were among the strongest performers. However, July reversed this trend as the faster rise in import values pushed Japan back into a merchandise trade deficit.
Rising energy costs expand import expenses
Japan’s July trade data also reflected the impact of increased crude oil prices on an economy that relies heavily on energy imports. The significant rise in the value of oil imports was mainly due to higher prices rather than increased physical volumes. This disparity contributed to a second consecutive record in total import costs. The weak yen further inflated the cost of goods denominated in foreign currencies, with imported energy remaining a substantial part of Japan’s overseas purchases.
Despite the record trade values, Japan’s export sector continued to benefit from strong overseas demand for technology-related goods. Exports supported economic growth during the April-to-June period, when the GDP expanded at an annualized rate of 1.1%. The July figures demonstrated that international demand remained firm at the beginning of the third quarter. At the same time, the 634.5 billion yen trade deficit highlighted how higher import costs prevented exports from matching record-breaking import levels, emphasizing the ongoing influence of rising energy expenses on Japan’s trade balance.