A supermarket display promoting US Pork in Japan; which is the largest importer of American Pork and Beef. Image Source: National Pork Board (Click to Expand)

From Maize to Machinery: US and Japan Top Trade Partners in Numerous Sectors


In the weeks following the March 11 Great Tohoku Earthquake, Japan’s importance as a link in the global supply chain was felt across the United States and the world. General Motors temporarily closed plants in Louisiana due to lack of Japan-made parts, and high-tech American companies such as Hewlett-Packard, which relies on Japanese suppliers for toner and other components, are also feeling the strain of Japan’s disrupted exports. As companies on both sides of the Pacific work to stabilize their inventories and Japan begins its recovery, the far-reaching effects of the disaster serve as a reminder of the importance of bilateral trade to two of the world’s largest and increasingly integrated economies.

As we reported previously, the United States and Japan are important trading partners. The Office of the United States Trade Representative estimates two-way trade in goods alone to be valued at over $205 billion for 2010. Exports between the two countries make up significant portions of a variety of sectors. The top export categories[1] by value to Japan from the United States in 2010 were: Machinery and Transportation Equipment ($16.8 billion), Chemical Products ($11.8 billion), Food and Live Animals ($10.9 billion), Miscellaneous Manufactured Articles ($9.6 billion), and Raw Materials ($3.8 billion).

Of these, the US was Japan’s top provider of imported goods in the Agriculture, Chemical, and Transportation Equipment sectors, according to data from the Japan Tariff Association. One quarter of all of Japan’s food imports come from the US: Japan imported more cereals, particularly maize and wheat, from the US than any other country. Additionally USTR reports that Japan is the largest purchaser of American pork by both value and volume, importing over 434,000 tons in 2010.

Pharmaceuticals top the list of chemical products exported to Japan, where American firms have gained nearly 20% market share. Japan is also the second largest world consumer of cosmetics; after France, Japan is the 2nd largest importer of US cosmetics and personal care products.

In the transportation sector, Japan’s American imports are dominated by aircraft and their associated parts and equipment. Procurement by the Japanese Ministry of Defense is the largest source of demand for the US aircraft industry, accounting for half of all US domestic production of aircraft and aircraft parts.

Composition of US-Japan Trade in 2010. Data Source: International Trade Administration; US Department of Commerce (Click to Expand)

In terms of US imports from Japan, the top import categories by value in 2010 were: Machinery and Transportation Equipment ($87.5 billion), Miscellaneous Manufactured Articles ($9.9 billion), Chemicals and Related Products ($9.1 billion), Manufactured Goods Classified Chiefly by Material ($8.7 billion), and Commodities & Transactions Not Classified Elsewhere ($3.3 billion). The US imports a wide range of manufactured goods and components from Japan, and the above categories include computer and electronic products and appliances as well as non-electrical machinery and consumer goods.

The US was Japan’s largest market for motor vehicles in 2009, accounting for 34% of their total vehicle exports. Imports in automobiles alone were worth nearly $33 billion. 34% of Japan’s auto part exports went to the US as well, with important components such as transmissions and power train parts comprising the greatest share. America is the top importer of Japanese power generating machinery, and electrical measuring devices. In the consumer market, accounting for nearly a quarter of overseas sales, the US is the largest buyer of Japanese video equipment. Ranging from televisions and monitors to camcorders, brands such as Sony and Panasonic have become household names.

[1] Using Standard International Trade Classification (SITC), the classification of goods to classify imports and exports in international trade maintained by the United Nations. Depending on the data, the US reports trade composition using one of more systems including SITC, Harmonized Commodity Description and Coding System (HS), or the North American Industry Classification System (NAICS). For the purposes of this article SITC was chosen for compatibility with Japanese data, which uses it in addition to its own domestic system.