TOKYO, JAPAN / RankWire.AI / – In July 2026, Japan recorded unprecedented trade values for both imports and exports, driven by soaring energy prices and robust demand for technology. Imports increased by 27.8% year-on-year to approximately 12.15 trillion yen, while exports grew 23.2%, reaching about 11.51 trillion yen. The Ministry of Finance announced a trade deficit of 634.5 billion yen, as import growth outpaced overseas shipments during the same period.
This marked the second consecutive month that imports hit a record level, with crude oil accounting for a significant portion of the increase. Japan’s crude imports rose by 5.5% in volume compared to July 2025, and the value of these shipments surged by 87.8% over the same period. These figures highlight much higher energy costs amid Japan’s continued heavy reliance on overseas supplies of oil and other fuels for domestic use.
Exports also reached a monthly high and maintained their upward trend for 11 consecutive months. The 23.2% rise in July followed a 19.3% increase in June. Technology products, especially those related to semiconductors, AI infrastructure, and data centres, remained a key driver of export growth. The weaker yen increased the yen value of overseas sales, further amplifying the sharp rise in Japan’s export figures.
Technology Exports Propel Overall Growth
During July, the United States and China continued to be major destinations for Japanese goods. Exports to the United States grew 22.0% year-on-year to around 2.09 trillion yen. Meanwhile, shipments to China increased by 25.8%, totaling about 2.01 trillion yen. Japan’s manufacturing sector, which supplies vehicles, machinery, electronic components, and semiconductor-related equipment, remains heavily reliant on external markets, making global demand a vital factor in the country’s merchandise trade performance.
The July data followed a strong first half of 2026, with exports from January to June rising 13.7% compared to the same period last year. During that half-year, imports grew more slowly. According to Japan Customs, electronic components and semiconductor-related products were among the significant contributors to export growth. The monthly trade balance shifted in July, as rising import values exceeded record exports, resulting in a trade deficit.
Rising Oil Prices Drive Import Total Higher
The notable increase in crude oil costs significantly impacted Japan’s import expenses. While physical volumes of oil imports increased modestly, the value of these shipments soared due to higher prices. Currency fluctuations also contributed, elevating the yen cost of many foreign-priced goods. Energy products remain a large part of Japan’s import basket, explaining why surging oil prices strongly influenced the overall import value.
As Japan entered the third quarter, trade flows on both sides of its merchandise account reached record levels. External demand for technology-related exports supported growth, whereas energy costs led to a sharper increase in imports. The 634.5 billion yen deficit demonstrated that despite record exports, the record import bill was not fully offset. July exemplifies one of the clearest monthly insights into Japan’s expanding trade values in 2026, combining strong overseas sales with notably higher purchase costs.