Trade with Japan Significant to States across the US

Exports to Japan by State. Data Source: US Department of Commerce; International Trade Administration (Click to Expand)

In the days immediately following the Great Tohoku Earthquake and subsequent tsunami and nuclear disasters on March 11, business analysts predicted a drop in US exports to Japan in some sectors. However as Japan begins its long road to recovery, state economies may enjoy a boost in trade to an important partner. Idaho, for instance, is expecting wood exports to Japan to climb as its rebuilds. Japan was already the state’s largest buyer of wood for homes.

As we reported previously, the United States and Japan are important trading partners and a significant customer for American products. In 2010, US exports of goods to Japan were valued at $62 billion. Looking at how this trade is distributed across the 50 states shows the impact of US-Japan trade at the local level.

According to the International Trade Administration of the Department of Commerce, 20 states had exports to Japan that were valued at least $1 billion in 2010. Of these, California was on top, exporting $12.1 billion worth of goods to the Japanese market. Recent reports show that despite the triple disaster in March of this year, California’s shipments to Japan were up 9% from March 2010 – rising faster than the state’s outgoing trade to Hong Kong, Taiwan, Singapore, Thailand, Germany, and the United Kingdom.

Despites these significant increases, the state that enjoyed the largest growth in exports to Japan over the past decade was Montana, which grew an incredible 249% from 2000 to 2010. Last year was one of Montana’s best years for export trade, to which the governor’s office credits its growing position in Asian markets as one of the primary drivers. The state has been particularly focused on Japan, where it operates a trade office in its sister-prefecture of Kumamoto. Japan is the largest importer of Montana’s wheat, the state’s leading export.

Data Source: US Department of Commerce; International Trade Administration (Click to Expand)

Alaska has the largest share of its global exports going to Japan in the nation, at just under 30%. There, the impact of the Japanese market on Alaska’s seafood industry, particularly salmon, is felt at the local level. The salmon industry brings in over $1 billion per year to the economy of Southeast Alaska, where it generates one in ten jobs. In a market that is largely driven by foreign demand, Japan is the largest customer of Alaskan seafood.

As businesses across the United States continue to do business with Japan and attempt to sell more of their products in one of the world’s largest markets, companies must work to overcome the challenges of bilateral trade, such as a substantial time difference and the ever-present language barrier. In order to overcome these and other hurdles, Georgia’s Purafil Inc., producer of air filtration systems, have worked with the local Japanese Consulate in Atlanta and hired a full time Japanese sales manager. These efforts are part of a five year plan to boost sales in Japan by 68%.

Please visit the data section of this website to find the 2010 trade figures to Japan for every US state.