Japan exports climb to record on chip demand, imports hit monthly record on oil costs

August 20, 2026 at 05:23 AM2 min

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Japan's exports climbed 23.2% year-on-year in July to a record 11.5 trillion yen and imports rose 27.8% to a record 12.1 trillion yen, official data showed Thursday. The trade deficit narrowed to 634.5 billion yen, below the 680 billion yen forecast, as a weaker yen and AI-related chip demand lifted exports while elevated oil prices pushed up import costs.

Key Facts

Japan's exports in July rose 23.2% year-on-year to a record 11.5 trillion yen, exceeding the median market forecast of 19.9% and following a 19.3% increase in June.
Japan's imports in July grew 27.8% year-on-year to a record 12.1 trillion yen, beating the 26.5% forecast and setting a fresh record for the second straight month.
Exports to the United States in July rose 22% from a year earlier, while shipments to China rose 25.8%.
Japan recorded a trade deficit of 634.5 billion yen in July, smaller than the 680 billion yen forecast.
Crude oil import volumes rose 5.5% from a year earlier, the first increase in four months, while the total value jumped 87.8%.

Export Surge

Japan's exports in July rose 23.2% from a year earlier to a record 11.5 trillion yen, exceeding the median market forecast of 19.9% and following a 19.3% increase in June. Strong demand tied to AI-related data centres and the yen's sharp falls made Japanese goods more competitive for overseas buyers. Exports to the United States rose 22% year-on-year in July and shipments to China rose 25.8%. The trade figures follow separate data this week showing Japan's economy expanded for a third consecutive quarter in April-June.

Record Imports and Oil Costs

Japan's total imports by value grew 27.8% from a year earlier to 12.1 trillion yen ($76.39 billion) in July, a fresh record for the second straight month and above the 26.5% forecast. Crude oil import volumes rebounded as alternative supplies, mainly from the United States, replaced Middle Eastern shipments disrupted by the conflict in the Middle East. Crude oil import volumes rose 5.5% from a year earlier, the first increase in four months, while the total value jumped 87.8%. The war in the Middle East earlier this year disrupted shipping through the Strait of Hormuz and triggered a surge in crude oil, petrochemical and other commodity prices, raising Japan's import bill.

Trade Balance and Demand

Japan recorded a trade deficit of 634.5 billion yen in July, compared with a forecast of 680 billion yen. Daiwa Institute of Research economist Koki Akimoto said the recovery in crude volumes, combined with persistently high oil prices and larger shipments of pricier U.S. crude, has been pushing up the value of imports. The strength in exports underscores resilient global demand, supporting an economy increasingly reliant on overseas shipments to offset weak domestic demand.