TOKYO, JAPAN / RankWire.AI / – Japan’s trade performance in July 2026 reached unprecedented levels for both imports and exports, driven by escalating energy prices and robust demand for technology products. Total imports increased by 27.8% from the previous year to approximately 12.15 trillion yen, while exports grew 23.2% to about 11.51 trillion yen, according to the Ministry of Finance. The trade balance showed a deficit of 634.5 billion yen, as import growth outpaced overseas shipments during the month.
For the second straight month, imports hit a record high, with crude oil accounting for a significant share of the increase. Japan’s crude imports rose by 5.5% in volume compared to July 2025, while the total value of these shipments surged by 87.8%. These figures highlight the impact of considerably higher energy costs at a time when Japan remains heavily dependent on imported oil and other fuels to meet domestic energy needs.
Meanwhile, exports also set a new monthly record and maintained their 11-month streak of year-on-year growth. The 23.2% rise in July followed a 19.3% increase in June. Export growth was notably supported by semiconductor-related products, with demand stemming from artificial intelligence infrastructure and data centres boosting shipments of technological components. Additionally, the decline in the yen’s value increased the yen amount of overseas sales, further contributing to the notable rise in Japan’s export figures.
Tech products bolster export expansion
In July, Japan’s primary export destinations remained the United States and China. Exports to the United States increased 22.0% from a year earlier, reaching approximately 2.09 trillion yen, while shipments to China grew by 25.8%, totaling around 2.01 trillion yen. Japan’s manufacturing industry supplies vehicles, machinery, electronic components, and semiconductor-related equipment to key markets abroad, making external demand a vital factor in the country’s monthly merchandise trade figures.
These July results followed a strong first half of 2026, during which exports from January to June rose by 13.7% compared to the same period in the previous year. While imports grew more slowly during this span, Japan Customs data indicated that electronic components and semiconductor-related products were among the main contributors to export growth. The month of July shifted the balance once again, with rising import values surpassing the record export levels and resulting in a trade deficit.
Rising oil prices drive import values higher
The notable increase in crude oil prices significantly influenced Japan’s import expenses. The value of oil imports climbed at a much faster rate than the physical quantities brought in, pushing total imports to a new monthly peak. Fluctuations in currency exchange rates also contributed to higher yen costs for many goods priced internationally. As energy remains a major component of Japan’s import portfolio, the surge in oil prices greatly impacted the overall import expenditure.
As Japan entered the third quarter, it experienced record trade flows on both the import and export sides of its merchandise account. External demand for technology-related products continued to support exports, while rising energy costs led to a larger increase in imports. The 634.5 billion yen deficit revealed that despite record export levels, the country’s import bill was equally high. July’s trade data illustrated a period of expanding trade values in 2026, characterized by strong external sales combined with sharply increasing purchase costs.