Resona Holdings, Inc. will allocate ¥30 billion over three fiscal years starting in April to develop artificial intelligence technologies and foster personnel with digital expertise, President Masahiro Minami said during a recent interview with The Yomiuri Shimbun.

The holding company, whose group includes Resona Bank and Saitama Resona Bank, aims to enhance productivity by introducing generative AI not only to its group’s in-house operations but also its financial products and services for outside parties, Minami said.

Resona Holdings had already announced that it would invest ¥121 billion in the digital field over the three fiscal years through March 2026.

Regarding the ¥30 billion investment, Minami said, “Now is the time that we should make drastic changes in our productivity,” adding, “We’re going to boost these reform.”

Resona Holdings plans to allocate the ¥30 billion to growth investments by excluding costs for system updates and other fixed costs. Generative AI is to be used “as the default” in operations at every group company, Minami said.

Generative AI will also be featured in the group companies’ financial products and services. “We also have to change the customer’s experience [with the group] at the same time,” Minami said.

For the current fiscal year, Resona Holdings has set a goal of increasing its gross profit to over ¥800 billion for the first time in 19 years.

Resona Holdings aims to upgrade its digital services and the loans that its group companies provide to small and midsize firms. For cashless payments, the group currently handles ¥2 trillion mainly through debit cards, but the holding company aims to increase that amount to more than ¥3 trillion as quickly as possible.
 
 

A cattle ranch has commercialized “frozen milk” in Hokkaido, the kingdom of Japan’s dairy products, and is expanding its sales channels.

Though freezing milk typically makes for an unpleasant taste once thawed, making use of flash-freezing technology has been a game-changer.

Freshness and flavor are not lost even after thawing, and the expiration date can be extended to about half a year compared to the one to two weeks when refrigerated.

The cattle ranch plans to export the product to other Asian countries.
“Trustworthiness and branding power of ‘made in Hokkaido’ products are great. I believe there is demand from high-income consumers,” said Toshifumi Suzuki, 43, who keeps about 90 dairy cows in Hiroo, Hokkaido. The town is in the Tokachi area, where dairy farms are prosperous.

Suzuki Farm, where he works, was established by his great-grandfather. When he began working there, the cows were fed enriched feeds made mainly with corn and artificial supplements. However, the cows repeatedly contracted infectious diseases.

In 2010, he changed the ranch’s feeding, believing the cows would be healthier if they were raised in an environment closer to nature. Once switching exclusively to organic grass, the cows became ill less often and the taste of their milk improved drastically.

In summer last year, he was hit with the idea of commercializing frozen milk upon learning about machines that freeze meat and fish extremely quickly to preserve freshness.

The machines are developed by Technican Co., a Yokohama-based freezer manufacturer.

The process involves immersing food containers in a liquid at minus 30 C, freezing it instantly without causing cell breakdown. Surely, Suzuki thought, the same process serving to preserve the freshness of food could be applied to milk?

Usually, thawing milk causes proteins and fats to separate, giving it a rough texture. Therefore, the Tokyo-based Japan Dairy Industry Association does not recommend freezing milk.

However, when Suzuki experimented using the quick-freezing method, it was confirmed that freshness and flavor were not lost even after thawing.

After an evaluation by a third-party inspection body, Suzuki began selling frozen milk with a six-month expiration period in summer last year. A 180-milliliter bottle of the frozen milk is priced at ¥700, including tax.

As it can be enjoyed without worrying about best-by dates, the milk is popular as a thank-you gift under the furusato nozei hometown tax donation system, in which people donate money to local governments of their choice in return for income tax deductions.

Also, since it is unlikely that leftover milk will need to be disposed, some customers buy the frozen milk for dairy product events.

Suzuki Farm plans to begin exporting to Singapore and Thailand in autumn.
“I want people all over the world to know the true taste of milk beyond the barrier of best-by dates,” Suzuki said.

Another cattle ranch in the area sells flash-frozen milk from cows raised exclusively on pasture grass, of which a 180-milliliter bottle is priced at ¥540, including tax.

Miyaji Bokujo ranch in Shimizu, Hokkaido, has shipped its frozen milk to a milk shop in New Chitose Airport and a Fukuoka supermarket.
 
 

The tariffs are "causing daily losses to Japan's economy", said Japanese trade negotiator Ryosei Akazawa after talks with top US officials.

Japan had made some progress in a fifth round of trade talks with United States officials aimed at ending tariffs that are hurting Japan's economy, Tokyo's chief tariff negotiator said.

"Tariffs have already been imposed on autos, auto parts, steel and aluminum, and some of them have doubled to 50 per cent along with 10 per cent general tariff.

These are causing daily losses to Japan's economy," Ryosei Akazawa, said in Washington on Friday (Jun 6) after talks with officials, including Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick.
Akazawa, a minister in charge of economic revitalisation, declined to say what progress they had made.

The latest round of talks may be the last in-person meeting between senior Japanese and US officials before the Group of Seven (G7) leaders summit that starts on Jun 15, where US President Donald Trump is expected to meet Japanese Prime Minister Shigeru Ishiba.
 
Japan also faces a 24 per cent tariff rate starting in July unless it can negotiate a deal with Washington.

"We want an agreement as soon as possible. The G7 summit is on our radar, and if our leaders meet, we want to show what progress has been made," Akazawa said.

"Still we must balance urgency with a need to guard our national interests," he added.

Last month Japan's trade negotiator said US defence equipment purchases, shipbuilding technology collaboration, a revision of automobile import standards and an increase in agricultural imports could be bargaining chips in tariff talks.

In a bid to reach an agreement with the US, Japan is also proposing a mechanism to reduce the auto tariff rate based on how much countries contribute to the US auto industry, the Asahi newspaper reported on Friday.
Akazawa said Japan's position has not changed and that the tariffs are not acceptable.

In a statement on Friday after Akazawa's near two-hour meeting with Lutnick, Japan's Foreign Ministry said that the Japanese minister had "once again strongly urged a reconsideration of the series of tariff measures by the US".

"Both sides reaffirmed each other’s positions regarding US tariff measures, and had a concrete discussion on expanding trade, non-tariff measures, and cooperation on economic security among others," the ministry added.

"They concurred to vigorously continue coordination with the aim of reaching a mutually beneficial agreement."
 
 

Suzuki Motor Corp has halted production of its flagship Swift compact hatchback due to China's export restrictions on rare-earth elements, sources close to the matter said, marking the first suspension by a Japanese automaker tied to the curbs.

The restrictions have caused delays in procuring parts that use rare earths, the sources said.

The Chinese government in April imposed export controls on seven types of rare-earth minerals as part of its retaliation against U.S. tariffs. The move has already begun to disrupt production in the United States and Europe.

Suzuki suspended production of the Swift, excluding the Sport model, at its Sagara plant in Shizuoka Prefecture, on May 26.

While it announced that it would partially resume production from June 13 and fully resume from June 16, it did not disclose the reason for the halt.
 


 

Japan’s Nikkei share average rose on Friday, as a weaker yen lifted sentiment, while concerns about trade tensions eased following a phone call between U.S. President Donald Trump and Chinese President Xi Jinping.

The Nikkei rose 0.5% to 37,741.61 but fell 1% for the week. The broader Topix climbed 0.47% to 2,769.33 while posting a 1.6% weekly loss.

“The trade talks seemed to have ended peacefully and that sent a positive sign to the market,” said Naoki Fujiwara, senior fund manager at Shinkin Asset Management.

On Thursday, Trump held a long-awaited phone call with Xi Jinping, in an effort to resolve trade disputes between the world’s two largest economies that have buffeted the global economy, and agreed to hold further discussions.

But caution ahead of the U.S. non-farm payrolls report, due later in the day, capped gains, Fujiwara said.

The Nikkei got technical support ahead of the fixing of special quotation prices, used to set values on index options and futures, next week, said Seiichi Suzuki, chief equity market analyst at Tokai Tokyo Intelligence Laboratory.

“Foreigners, who shorted the Nikkei futures, bought them back ahead of the fixing day, which also lifted the Nikkei index.”

The yen, which last traded down 0.3% at 144 per dollar, also supported local equities, Shigetoshi Kamada, general manager at the research department of Tachibana Securities, said.

Chip-related heavyweights Tokyo Electron and Advantest rose 1.28% and 2.23%, respectively.

Automakers gained, with Honda Motor and Nissan Motor adding 1.3% and 1.27%, respectively, while Toyota Motor moved 0.06% higher.

Panasonic Holdings, which supplies batteries for Tesla, lost 2.37% after Tesla shares plunged 14.3%.

ispace tanked 29% to 744 yen, hitting the day’s exchange-allowed floor, after the space venture said that its uncrewed moon lander likely crashed onto the lunar surface during its touchdown attempt.
 
 

 

Two major convenience store chains in Japan began selling government-released stockpiled rice at select stores in Tokyo and Osaka on Thursday, joining major supermarkets and e-commerce platforms in a move to increase availability of the staple food for consumers struggling with soaring rice prices.

The outlets of FamilyMart and Lawson will sell the rice from the 2021 harvest in small portions to make it affordable for people, including those living alone.

While many other retailers sell it in bags of 5 kilograms for about 2,000 yen FamilyMart sets the price of its 1-kg package at 388 yen, and Lawson's is at 389 yen and 756 yen for 2 kg. Both will limit their sales to one package per customer.

Lawson said it will make the rice available at its 13,800 stores nationwide on June 14, excluding those in Okinawa, while Family Mart said it will also expand areas selling them.

"If (FamilyMart) provides the stockpiled rice nationwide, it will help expand access," farm minister Shinjiro Koizumi said as he inspected a Family Mart outlet in Tokyo.

Seven-Eleven Japan also said it will start selling stockpiled rice in some stores, including those in Tokyo and Osaka, on June 17 for 775 yen for 2 kg and gradually expand availability.

The three major convenience store chains secured stockpiled rice through direct contracts as small- to medium-sized distributors after being rejected as major distributors due to a lack of transaction history.

Some retailers that signed contracts as major distributors started selling the rice at the end of May and have already been running out of stock.
 
 

Nintendo Co. released the Nintendo Switch 2, its first video game console in eight years, on Thursday.

Applications had flooded in for lottery pre-orders on the official online Nintendo store and other sites. There are currently no plans to sell the Switch 2 in physical stores and only lottery winners received the console at major mass retailers.

At Bic Camera Inc.’s main store in Toshima Ward, Tokyo, about 30 lottery winners lined up at the doors even before the store’s 10 a.m. opening.

“I’m so happy that it doesn’t feel real,” said a beaming 24-year-old company employee from Toda, Saitama Prefecture. “I can’t wait to play with it when I get home.”

The recommended retail price of the Switch 2’s domestic-only model is ¥49,980, including tax. The new console’s liquid crystal display is larger than the first-generation model, and it comes with a featured game chat function, which enables the user to remotely chat with other players.

Nintendo is intending to sell 15 million Switch 2 consoles worldwide in the first fiscal year. The company has not disclosed how many of the consoles are allocated to Japan.
 
 

KDDI Corp. plans to conduct a trial demonstration operating drones through direct communication with Space Exploration Technologies Corp. (SpaceX)’s Starlink satellite network by the end of this year.

This initiative, anticipated to be able to aid in disasters such as earthquakes, aims for practical implementation by March of next year, the company stated Thursday.

Drones presently utilize cellular networks for extended-range operations. However, in areas with no network coverage, it is required to deploy mobile base stations.

Direct communication with Starlink is expected to facilitate drone operations in challenging environments such as mountainous terrain and remote islands.
From October onwards, KDDI will gradually establish drone take-off and landing bases at 1,000 locations nationwide.

These drones will first be introduced in Ishikawa Prefecture, where KDDI has a comprehensive partnership agreement for recovery efforts from the 2024 Noto Peninsula Earthquake.

Then, drones will be deployed sequentially to Lawson convenience stores in which KDDI is involved in management, as well as to city halls and other locations.

The company plans to use them for tasks such as monitoring social infrastructure like power lines, monitoring work at construction sites and supporting search activities during disasters.
 
 

The world's top-selling carmaker Toyota said Tuesday it would take its auto parts-making subsidiary Toyota Industries private in a deal that reportedly valued the unit at more than $40 billion.

Toyota Industries, which also manufactures forklifts and other industrial vehicles, will go private under a holding company comprised of Toyota Motor and others, the firms said.

Toyota Motor had previously owned around 23 percent of Toyota Industries -- the original company, once a family loom business, that Toyota Motor evolved from.

Before the deal was announced, media reports had said that it valued Toyota Industries at $42 billion.

Taking Toyota Industries private "would allow more freedom in management" and could be good news for long-term investors, Bloomberg Intelligence analyst Tatsuo Yoshida said in April.

But he cautioned that the buyout would require raising a large amount of funds, so it is unclear whether it makes economic sense, Bloomberg reported at the time.
 
 

4th edition of IJBC-led summit to spotlight technology, trade, sustainability, and SME collaboration between the two nations.

In a significant step toward reinforcing bilateral economic cooperation, the Indo-Japan Business Council (IJBC) will host the 4th edition of the India-Japan Business Conference on July 10, 2025, in Chennai.

Themed “Accelerating Indo-Japan Partnerships in Technology, Trade, and Sustainability,” the conference aims to provide a dynamic platform for dialogue and collaboration between policymakers, business leaders, SMEs, and domain experts from both countries.

The event is designed to further strengthen the economic synergy between India’s expanding market and Japan’s global leadership in technology and sustainable business practices. Against the backdrop of a rapidly shifting global economy, the conference will emphasize practical avenues for enhancing cross-border partnerships, particularly through digital innovation, sustainable development strategies, and SME empowerment. Abhishek Choudhury, Vice President, Indo-Japan Business Council (IJBC), said, “At IJBC, we believe this is the moment to accelerate India–Japan partnerships. Through this conference, we are not just discussing possibilities—we are building real, long-term cooperation in technology, trade, and sustainability.”

The conference will commence with welcome remarks by Siddharth Deshmukh, President of IJBC, followed by special addresses from the Consul-General of Japan in Chennai and a senior representative from the Government of India.

A key highlight of the morning session will be a presentation by the Japan External Trade Organization (JETRO) focusing on how emerging technologies can drive Indo-Japan economic growth. A group photograph and a tea break will follow this. Throughout the day, participants will engage in an array of sessions, including case studies, panel discussions, and fireside chats. One of the spotlight sessions will feature a case study on Indo-Japan collaboration in renewable energy, exploring how the two nations are working together to chart a greener future.

Another key segment includes a fireside chat on building resilient and future-ready business ecosystems, followed by a panel discussion focused on strengthening Indo-Japan business partnerships in the areas of trade and technology.

Post-lunch sessions will include sponsor presentations and a keynote address on navigating sustainability in global trade. A subsequent case study will showcase the Indo-Japan smart city development model, highlighting urban development partnerships between the two nations. Another fireside chat will delve into unlocking opportunities for SMEs and scaling cross-border ventures. 

The final session of the day will feature a panel discussion on sustainable business practices and collaboration in the circular economy. The event will close with remarks by Mr. Abhishek Choudhury, Vice President (Strategy) of IJBC. A cocktail dinner will follow in the evening, offering attendees a relaxed networking environment to foster future partnerships. The India-Japan Business Conference 2025 seeks to drive forward-looking conversations on policy advocacy, market access strategies, and innovation-driven growth.

Organizers aim to generate actionable policy recommendations, enhance business readiness among small and medium-sized enterprises (SMEs), and forge new pathways for sustainable bilateral trade.

With a carefully curated agenda and high-level participation from both countries, this edition is expected to foster a stronger, more interconnected Indo-Japanese business network and lay the groundwork for transformative economic cooperation.

Further details, registration, and sponsorship information are available on the official website at www.bizcon.ijbc.org or by contacting the organizing committee at abhishek.choudhury@ijbc.org.


Info-Box:

The conference is structured to deliver a 360-degree view of Indo-Japan collaboration. Special focus areas include:

• Technology and Innovation: Co-developing digital ecosystems and smart manufacturing frameworks.
• Green Business and Sustainability: Promoting carbon-reduction strategies and eco-friendly infrastructure.
• Trade Facilitation: Reducing entry barriers and encouraging cross-border investments.
• SME Empowerment: Sharing best practices and unlocking global opportunities for smaller enterprises.

 
 
 

 

 

Leadership Shift Comes Amid Insurer Investment Shakeup

Tsutsui Yoshinobu, former chair of Nippon Life Insurance, has been appointed as the new chair of Keidanren, Japan’s most prominent business lobbying organisation.

His appointment marks a shift in the group’s leadership tradition, as Tsutsui is the first to come from a financial institution rather than a manufacturing background.



Ex-insurance leader takes leadership of Keidanren

Effective May 29, Tsutsui begins his tenure at a time when the role continues to serve as a key link between the private sector and government policymaking, according to a Nippon report.

Tsutsui, who stepped down from his leadership post at Nippon Life to take up the new position, will serve a term of four years, divided into two two-year periods.



Non-traditional background for business lobby leader

Traditionally, Keidanren chairs have emerged from listed manufacturing giants.

According to the Nippon report, Tsutsui breaks from this convention not only by coming from the finance sector but also by having led a mutual company – Nippon Life – where policyholders are members rather than shareholders.

His corporate career includes his 2011 appointment as president of Nippon Life, during which he directed the firm’s acquisition of Mitsui Life Insurance in 2015, now operating under the name Taiju Life. He was elevated to chairman in 2018 and joined Keidanren’s executive board as vice chair in 2023.

In 2024, Tsutsui was appointed to lead the GX Acceleration Agency, a government initiative focused on energy transition and decarbonization.



Bond market challenges confront Japan’s life insurers

Tsutsui’s elevation coincides with challenging conditions for life insurers in Japan, where rising domestic interest rates have contributed to steep declines in the value of long-term government bond holdings.

For the fiscal year ending March 2025, Nippon Life reported unrealised losses of approximately ¥3.6 trillion (around US$25 billion), along with ¥500 billion in realized losses due to bond sales.

Meiji Yasuda Life Insurance also recorded a substantial increase in paper losses, which grew to around ¥1.386 trillion (US$9.7 billion) from ¥161.4 billion the previous year.

These losses have prompted both insurers to reconsider their investment strategies, particularly with regard to government debt. Long-duration bonds, typically used to match long-term insurance liabilities, have become more volatile as interest rates rise.



Strategic rebalancing of portfolios

Executives from both firms have indicated a shift in asset allocation strategies.

Nippon Life said it plans to reduce its purchases of government bonds in the current fiscal year to better manage interest rate risk.

A representative from the insurer noted that the adjustment aims to create “a more stable asset profile in response to ongoing market conditions.”

Meiji Yasuda is undertaking a similar review, signalling potential changes in how it allocates capital across fixed-income and alternative assets.
 
 

The requests heighten the chance the central bank will proceed slowly in reducing its huge balance sheet

The Bank of Japan (BOJ) received a sizeable number of requests to maintain or slightly slow the pace of tapering in its bond purchases from fiscal year 2026 onward, minutes of a meeting between the bank and financial institutions showed on Monday (Jun 2).

Despite a recent spike in super-long yields, a significant number of bond market participants also urged the central bank to leave its existing bond taper plan to March 2026 unchanged.

The requests, made at a BOJ meeting with bond market participants on May 20 to 21, heighten the chance the central bank will proceed slowly in reducing its huge balance sheet.

The BOJ will conduct a review of its current taper plan and come up with a subsequent programme at its next policy meeting on Jun 16 to 17.

“From the viewpoint of predictability, the bank should maintain the current pace of the reduction,” one participant was quoted as saying in the minutes about the BOJ’s plan for April 2026 onward.

The central bank has been slowing bond purchases since August last year to halve monthly buying to three trillion yen (S$27 billion) by March 2026.
While the participants diverged on how much the BOJ should taper beyond April 2026, several called for reducing its monthly purchases to around one trillion yen to two trillion yen by the end of the new taper programme, the minutes showed.

One person called for eventually reducing purchases to zero, while another called for maintaining the current three trillion yen monthly pace “for a while”.

The new programme from April 2026 should display the BOJ’s taper plan for a full year, one participant was also quoted as saying.

The BOJ’s taper review comes at a delicate time. Yields on super-long Japanese government bonds (JGB) soared to all-time highs last month on weak investor demand, as political calls for big fiscal spending flare up ahead of an upper house election slated for July.

Many bond market participants warned of declining market liquidity for super-long bonds, with some calling for a response by the BOJ, according to the minutes.

“The Bank should consider making flexible responses for this zone,” such as by suspending reductions in its bond buying or ramping up purchases of super-long bonds, the minutes showed.

Some called for making tweaks to the way the BOJ conducts its bond-buying operations so that it can more flexibly adjust the amount of super-long JGBs purchases.

Others, however, warned the BOJ against responding too much to swings in super-long yields.

“The deterioration in supply and demand conditions in the super-long-term zone is due to structural factors,” such as weak investor demand relative to the size of issuance, one participant was quoted as saying. “There is thus limited room for the Bank to address the root cause.”

The BOJ has lagged well behind global counterparts in whittling down crisis-era stimulus, having only exited last year a decade-long, massive stimulus aimed at pulling the economy out of stagnation. It also ended negative interest rates last year, though short-term borrowing costs are only 0.5 per cent.
 
 

The Japanese government's stockpiled rice released through direct contracts with retailers began hitting store shelves Saturday, with consumers flocking to the cheaper products.

Major supermarket operator Ito-Yokado Co and home appliance company Iris Ohyama Inc were the first to start selling the rice at some of their shops, both setting a price tag of 2,160 yen including tax for a 5 kilogram-bag.

At an Ito-Yokado store in Tokyo's Ota Ward, 500 bags of rice sold out in just 30 minutes since its opening at 10 a.m. Other Ito-Yokado stores will also start selling the rice on Sunday or later.

At a home center operated by an Iris Ohyama group company in Sendai, Miyagi Prefecture, some 250 people lined up before 8 a.m. in the rain to get numbered tickets to purchase the rice.

"It's cheap, and that helps," Mitsuko Matsuura, 71, said, expressing her relief that she was able to purchase the rice. She also said its taste was "not so different" from newly harvested rice.

An 82-year-old man was disappointed that he was not able to make a purchase. "We are a family of five, so it's quite tough. I would like to come again to buy (the rice)."

In the latest effort to bring down the soaring price of rice that has been hitting households, the Japanese government began selling its stockpiles through direct contracts with retailers earlier this week.

Subject to the direct contracts is 300,000 tons of rice from 2021 and 2022.
Ito-Yokado secured 5,000 tons and Iris Ohyama 10,000 tons of the 2022 harvest. Supermarket giant Aeon Co and discount store chain Don Quijote will also start selling the stockpiles they procured from Sunday.

The Ministry of Agriculture, Forestry and Fisheries initially offered reserve rice through auctions. But it switched to selling it directly to retailers in the hope that doing so will be more effective in curbing rice prices.
 
 

Core consumer prices in Tokyo climbed 3.6 percent in May from a year earlier, rising at the fastest pace in over two years, official data showed Friday, as the cost of rice remained on a sharp upward trajectory.

The rise in Tokyo's core consumer price index, excluding volatile fresh food items, followed a 4.3 percent jump in January 2023, the highest in nearly 42 years, due partly to Russia's protracted war in Ukraine and the yen's depreciation.

The core CPI in Japan's capital, viewed as an indicator of nationwide trends, was driven up by soaring rice prices in May, which climbed 93.7 percent after surging 93.8 percent in April, the biggest year-on-year increase since comparable data became available in 1971.

In early May, the average price of rice, the nation's staple food, reached a record 4,268 yen per 5 kilograms in Japanese supermarkets, roughly double the previous year's level, following a poor harvest, the agriculture ministry said.
 
 

The Japanese government on Friday vowed to explore new overseas markets and provide support for more efficient production as part of efforts to increase rice exports in response to an envisioned long-term contraction in domestic consumption.

In the annual white paper on food and agriculture for fiscal 2024 approved by the Cabinet, the Ministry of Agriculture, Forestry and Fisheries recommends increased rice exports despite the Japanese government recently introducing measures to curb soaring domestic prices, driven in part by shortages.

The report identified China, Singapore, the United States, Hong Kong and Taiwan as target markets for exports.

With the popularity of Japanese food booming abroad, the country's exports of agricultural goods reached a record 1.51 trillion yen ($10.5 billion) in 2024, as it sets a target of 5 trillion yen in 2030, the paper said.

To achieve that target, the government wants to increase rice exports, which trended higher to 12.03 billion yen in 2024 -- 27.8 percent above the year before -- through sales at Japanese restaurants and stores.

The government set a goal to boost rice exports by nearly eightfold to 353,000 tons in 2030 from 2024 in its medium- to long-term basic plan for agriculture, released in April.

To bolster productivity for rice exports, the government aims to increase the acreage managed by export-focused farmers with fields of 15 hectares or larger.

It also seeks to reduce the current production costs of 16,000 yen per 60 kilograms nearer to 9,500 yen for exports to help domestic producers better compete with foreign-grown rice, according to the plan.

New farm minister Shinjiro Koizumi also urged rice growers to increase output, despite the government issuing a guideline annually for each major producing region to match expected demand, a step that has led to adjustments in supply. He said last week that even if there is a surplus, rice could be exported overseas or the government could find new ways to market it.

Prime Minister Shigeru Ishiba is also supportive of increasing agricultural exports, saying in a recent TV program, "Rather than saying, 'We will export if there is a surplus,' we should aim to export from the beginning."

The paper, which includes a chapter dedicated to agricultural exports for the first time, said, "It is essential to shift to earning money in growing overseas markets" as domestic consumption is expected to decline due to the falling population.
 
 

 

Japan’s cooperation in the development of liquefied natural gas (LNG) in the U.S. state of Alaska has emerged as a bargaining chip in the ongoing Japan-U.S. tariff negotiations.

While U.S. President Donald Trump is expecting Japan, South Korea and other countries to participate in the development project, doing so is expected to require over ¥6 trillion, prompting some major trading companies and energy companies to question the profitability of the project.

Strong focus on U.S. side

According to the Alaska Gasline Development Corp. (AGDC), which is responsible for the project, the plan is to lay a roughly 1,300-kilometer-long pipeline from gas fields in northern Alaska.

Gas from the fields will be transported to the Pacific coast in southern Alaska, from which the gas will be exported to the rest of the world, and 20 million tons of gas are expected to be exported to Asia per year.

At a Japan-U.S. summit in February, Japan agreed to work with the United States to expand imports of U.S. LNG. Trump in March said in an address to the U.S. Congress that Japan and South Korea wanted to partner with the United States on the project. In mid-May, Alaska Gov.

Mike Dunleavy stated that they were discussing a broad range of issues with Japan, South Korea and other countries. The U.S. side has shown strong enthusiasm for the project.

An international LNG conference is scheduled to take place in Alaska in early June, and officials from Japan, South Korea and Taiwan have been invited to it. Trump reportedly hopes that Japan and South Korea will express their willingness to participate in the development project at this conference.

The project is estimated to cost as much as $44 billion (about ¥6 trillion). If the project has participants from Asia, which are potential importers of the LNG, this will help reduce the burden on the U.S. side. In addition, Trump places strong emphasis on the project apparently because LNG exports will help reduce the U.S. trade deficit.


Harsh environment

The issue of the Alaska LNG project may seem to have emerged out of nowhere. However, for officials in the energy industry, the project has been discussed for over two decades.

Since the northern part of Alaska where the gas fields are located faces the ice-covered Arctic Ocean, it would be difficult to export gas directly from a port. If a pipeline is laid, it will enable the supply of LNG to southern urban areas through which the pipeline will run.

AGDC aims to start production in 2031. However, the construction of the pipeline will need to be done in a harsh environment as it is supposed to pass over 800 rivers and through three mountain ranges, including Mt. Denali, or Mt. McKinley, which is North America’s tallest mountain.

“I don’t think construction can be completed by 2031,” said a major trading company executive.

Some believe the construction costs could balloon to more than ¥10 trillion due to recent inflation.

Kenichi Hori, president of Mitsui & Co., Ltd., said, “It is necessary to thoroughly examine the economic potential and long-term sustainability of the entire project.”

 

Geopolitical risks

As LNG emits less carbon dioxide when burned than oil, Japan’s Strategic Energy Plan positions it as a realistic fuel for the time being. However, its supply is often influenced by geopolitical risks.

In Arctic LNG 2, an LNG project in Russia’s Arctic Circle in which Mitsui & Co. and other companies are participating, LNG production has been suspended due to economic sanctions against Russia and there is no prospect of LNG being supplied to Japan.

To diversify risk, major trading companies, power and gas companies, and others are working to diversify and expand their interests in Southeast Asia, Australia, the Middle East and North America.

If the Alaska project becomes operational, LNG could be delivered to Japan in about a week, which is expected to help reduce the number of days required for delivery.
Even so, there is deep-rooted concern regarding the project.

“If we end up buying more expensive energy, it will only result in the public having to bear a greater burden,” said a senior official of the energy industry.
The government and related companies will have to consider this issue carefully.
 

 

Money-losing Japanese automaker Nissan Motor Corp is banking on its latest “e-Power” technology for a turnaround.

A kind of hybrid, e-Power comes equipped with both an electric motor and gasoline engine, much like the Toyota Motor Corp Prius. It’s different from a Prius in that it doesn’t switch back and forth between the motor and engine during the drive.

That means the car always is running on its EV battery, ensuring a quiet, smooth ride.

“Nissan has a proud history of pioneering innovative technology that set us apart,” Chief Technology Officer Eiichi Akashi told reporters on the sidelines of a test drive at its Grandrive course outside Tokyo.

The advantage of e-Power vehicles is that they never need to be charged like EVs do. The owner just fuels up at a gas station and the car never runs out of a charge.

Nissan, which racked up a 670.9 billion net loss for the fiscal year through March, sorely needs a hot-seller, especially in the lucrative North American market. But the U.S. market is proving a big headache for all the Japanese automakers because of President Donald Trump’s tariff policies.

To achieve a turnaround, Nissan is working on reducing costs, strengthening business partnerships and redefining its lineup. That's where e-Power fits in, according to Akashi.

Yokohama-based Nissan announced earlier this month that it’s slashing about 15% of its global work force, or about 20,000 employees, and reducing the number of its auto plants to 10 from 17, under an ambitious recovery plan led by its new Chief Executive Ivan Espinosa.

Nissan officials did not give a price for the upcoming e-Power models. The only other automaker offers a similar technology is “kei,” or tiny car manufacturer Suzuki Motor Corp.

E-Power is already offered on the Nissan Qashqai and X-Trail model in Europe, and the Note in Japan. The upgraded version will be offered in the new Rogue in the U.S.

Nissan, a pioneer in EVs with its Leaf, which went on sale in 2010, is also preparing beefed up EV models. It's also working on a solid-state battery which is expected to replace the lithium-ion batteries now widely used in hybrids, EVs and e-Power models.

Analysts say Nissan is in danger of running out of cash and needs a partner. Speculation is rife its Yokohama headquarters building will get sold, or one of its Japan plants will be turned into a casino.

Nissan started talks last year with Japanese rival Honda Motor Co. for a business integration but announced in February that it was dropping the talks.
 
 

Japanese Prime Minister Shigeru Ishiba on Sunday said Tokyo aims to advance tariff talks with the United States, with the goal of achieving an outcome during the Group of Seven summit next month.

Japan’s top tariff negotiator Ryosei Akazawa held a third round of Japan-U.S. talks in Washington on Friday.

Speaking to reporters in Kyoto, Ishiba said there has been progress in negotiations, pointing to discussions on trade expansion, non-tariff measures and economic security.

“We will continue to further refine our discussions with the G-7 summit in mind,” he said.

Ishiba on Friday held a 45-minute phone call with U.S. President Donald Trump to discuss security, diplomacy, and tariffs, and said they exchanged hope for an in-person meeting at the G-7 summit.

On Sunday, Ishiba expressed Japan’s willingness to cooperate in shipbuilding. He said the U.S. has shown interest in the possibility of repairing U.S. warships in Japan and that Japan would like to assist.

He said Japan has an advantage in icebreakers, such as those used on Arctic trade routes, which could become an area of cooperation with the U.S.
In Tokyo, Akazawa on Sunday said the schedule for the next Japan-U.S. talks is being arranged and that he hopes to meet U.S. Treasury Secretary Scott Bessent during his next visit to the U.S.

Speaking to reporters at Haneda Airport following his return from Washington, Akazawa said an agreement will be reached only when all elements are settled as a package, meaning that until everything is agreed upon, nothing is agreed upon.

“Therefore, I won’t comment on how far we’ve progressed,” he said.
 
 

The government will launch measures to revive the shipbuilding industry, which has been declining for a long time, according to sources. It will support the private sector in the construction and repair of shipbuilding docks and in starting businesses overseas.

China has an overwhelming share of the world’s shipbuilding market, and economic security concerns are growing in the international community. As the administration of U.S. President Donald Trump regards strengthening the country’s shipbuilding capability as one of its important policies, Japan hopes to promote cooperation with the United States in this area and use it as a bargaining chip in the upcoming tariff negotiations.

The government aims to support the domestic industry and promote cooperation with the United States at the same time. It will include specific measures in its Basic Policy on Economic and Fiscal Management and Reform, also known as the “big-boned policy,” and secure the necessary budget.

As for domestic measures, it will support domestic investment, technology development and establishing data infrastructure in the shipbuilding industry through the Economic Security Promotion Law. This is in consideration of the fact that shipbuilding is a dual-use industry, which develops and produces vessels for both private and military purposes.

To strengthen domestic shipbuilding capability, which is currently insufficient to meet the recent increase in demand, the government will support to construct new shipbuilding docks by reviving unused docks and dockyards.

The government will also increase the budget related to green transformation to support the building of ships that include next-generation vessels fueled by blue ammonia. Blue ammonia is produced from fossil fuel in which the carbon dioxide emissions generated during the process are captured and stored.

The government will also help Japanese companies construct large-scale docks overseas and start businesses in those locations.

As for possible Japan-U.S. cooperation, the government is considering a “Japan-U.S. fund for reviving the shipbuilding industry.” It will propose joint construction of blue ammonia ships and vehicle carriers, hoping to utilize Japan’s design capabilities and Japan-made manufacturing parts. It will support Japanese and U.S. companies to construct dockyards in the United States.

Based on the technology of Japanese icebreaker Shirase, it plans to jointly develop and produce new icebreakers and cooperate in repairing warships with the United States. It also aims to establish a supply chain between Japan and the United States to avoid too much dependence on China.

China currently has a 70% share of newly built ships and 90% share of ship repair. Japan had a 50% share of newly built ships in the early 1990s, but currently has only 10%. As Japan depends on China for its supply of ships, its maritime transportation may be affected in a contingency. Japan aims to strengthen its economic security by reviving its shipbuilding industry.

The Trump administration also aims to revive the U.S. shipbuilding industry. It has already started to eliminate Chinese ships; the U.S. government said it would collect fees from China-made ships when they enter U.S. ports.

Japan and the United States were to hold their third ministerial meeting about the tariffs on Friday. Japan intends to convey to the U.S. government its intent to cooperate in reviving both countries’ shipbuilding industries, hoping to extract concessions in the negotiations.
 
 

Nissan Motor Co is considering selling its headquarters building in Yokohama to help cover costs related to plant closures and other restructuring efforts, sources familiar with the matter said.

The struggling automaker may also book an additional 60 billion yen in restructuring costs this fiscal year as it pushes ahead with its revamp plans, according to records from a meeting with analysts last week on its latest earning results.

Nissan announced on May 13 that it posted a net loss of 670.9 billion yen in the fiscal year ended March after recording an impairment loss of 460 billion yen and 60 billion yen in restructuring costs under its reform plans.

The carmaker did not issue an earnings forecast for the current fiscal year, as additional restructuring costs and the impact of U.S. tariffs have yet to be factored in, Nissan Chief Financial Officer Jeremie Papin said at a press conference that day.

Even if it sells its headquarters, Nissan may consider leasing back the office space. But it remains unclear whether the company will ultimately go ahead with the sale as some executives oppose the idea, the sources said.

Japan's third-biggest automaker by volume is in need of funds, having announced that it will shut seven of its current 17 auto assembly plants and cut 20,000 jobs globally.

Pressured by faltering vehicle sales in China and the United States, coupled with a series of U.S. tariffs, Nissan is rushing to streamline its global operations to return to profitability in the next fiscal year.
 
 

Amid nationwide high rice prices, Aichi Prefecture is striving to increase rice production. The prefecture, though, faces a formidable threat from pests, whose damage is intensified by global warming, making it more difficult to combat them.

The prefecture has set its production target for this year at about 131,800 tons — an increase of about 5,400 tons from the previous year and the highest since 2018 — with the aim of using this increased output to bring down soaring prices.

Even now, when farmers across the prefecture are only at the stage of early-season planting, they are already contending with challenges like pest damage, a problem believed to be aggravated by global warming.

On April 11 in Yatomi in the prefecture, employees of YTAgri, a rice farming business owning about 70 hectares of paddies, planted 400 trays of Akita Komachi rice seedlings, anticipating a harvest of about 12 tons in early August.

Last year, YTAgri produced about 336 tons of rice. Ryota Yamaguchi, the representative of the company, said emphatically: “The best way we can help consumers facing this rice shortage is to maximize production. While we can’t instantly expand our planted area, we will dedicate ourselves to boosting yields.”

Aiming to produce 380 tons this year, the company is investing in its paddies, fortifying them through measures like increased fertilization for larger ears of rice and strict pest and disease management. Nevertheless, Yamaguchi worries: “Fertilizer costs are 1.5 times what they were five years ago. Fuel prices are rising too, which is another headache.”

Aiming to hold down spiking rice prices, the central government, which had previously set national production targets, shifted this responsibility to the prefectural level in 2018.

The targets set by the Aichi Prefecture’s agricultural regeneration council, a group established by the prefectural government and producer organizations, were previously on a slight downward trend, from about 131,300 tons each year between 2018 and 2022 to about 129,000 tons in 2023, and then to roughly 126,400 tons in 2024. However, this year’s target is about 131,800 tons, up by about 5,400 tons from last year.

The prefecture reported that last year’s rice harvest was only 124,300 tons as a result of poor growth due to high temperatures and other factors.

Furthermore, the first-ever temporary Nankai Trough earthquake warning, issued last summer, is thought to have intensified the rice shortage by prompting increased household stockpiling.

In addition to impacting rice growth, global warming is posing another problem for producers by contributing to a surge in pests.

The invasive giant apple snail, not native to Japan, poses a significant threat, as it voraciously consumes young, tender rice seedlings within two to three weeks of planting and deposits large, toxic egg masses.

A survey last year by the Aichi Prefectural Agricultural Research Center found the giant apple snail in a record 35.4% of 130 studied rice paddies. In the Mikawa region, some farmers reported planting rice seedlings one day and finding them entirely consumed the following morning.
 

 

Another serious issue is the damage caused by rice stink bugs, which feed by piercing rice ears and sucking their sap around the summer before harvest, leading to blackening and reduced rice quality.

In some areas, the population of these bugs has reached 10 times the normal level. The Agriculture, Forestry and Fisheries Ministry explains that this increase stems from a larger number of bugs surviving the winter because of global warming.

JA Aichi Economic Federation reports that the proportion of top-grade rice harvested in the prefecture fell from the usual 80% to 40% for the 2023 and 2024 crops due to rice stink bug damage and other causes.

“Reduced yield and quality directly cut into profits. Although we can’t predict the extent of the damage, we will quickly share information with producers and work with local governments to offer effective pest control guidance when outbreaks occur,” a federation official said.
 
 

The decision was made due to a slowdown in the global emissions reduction trend

Japanese steelmaker Kobe Steel has announced some changes to its investment plans for the three-year financial period between 2024 and 2026 due to rising global uncertainty. In this way, the company aims to maintain its financial stability and prioritize economic rationality in the short term, SteelOrbis reports.

Kobe Steel has reduced its investment plan for the period from approximately 950 billion yen ($6.23 billion) to 750 billion ($5.53 billion).

The company will allocate approximately 150 billion yen ($1.05 billion) to decarbonize its operations, compared to the original plan of approximately 300 billion yen ($2.09 billion) due to the slowdown in the global trend towards carbon neutrality.

The Japanese steelmaker intends to reduce its carbon emissions by 30-40% by 2030 compared to 2013 levels and achieve carbon neutrality by 2050.

To achieve these goals, the company plans to use large-scale innovative electric arc furnaces and ammonia co-combustion technology in blast furnaces starting in 2030.

Kobe Steel also aims to increase the use of scrap, integrate biomass into blast furnaces and implement energy-efficient processes.

As GMK Center reported earlier, Třinecké Železárny Group, the largest steel producer in the Czech Republic, is postponing the completion date of the largest decarbonization investment in the plant’s history.

The main reasons for the delay in the implementation of the EAF are the lack of public support, uncertainty about the future direction of Europe in the rules related to the Green Deal, the current negative situation on the steel market, and unclear import protection rules.
 
 

The Japanese government on Thursday started a revamped gasoline subsidy designed to cut prices by 10 yen ($0.07) per liter to help ease cost-of-living pressures for consumers ahead of an upcoming parliamentary election.

Under the previous scheme introduced in January 2022, the government had subsidized wholesalers to keep regular gasoline prices at around 185 yen per liter, but will now provide a fixed sum regardless of prices, which have recently dropped below that benchmark.

The government subsidy aims to reduce the wholesale gasoline price by 7.40 yen per liter in the first week, a targeted 5 yen effective decrease from a week earlier when crude price fluctuations are taken into account. It then aims to reduce the price by at least 1 yen weekly until it is 10 yen lower by mid-June.

Price reductions are expected to flow through to gas stations in two to three weeks, taking into account inventories, it said.

No end date has been decided for the program, but with around 1 trillion yen allocated to the subsidies, they could last until the end of March 2026.
The reintroduction of the subsidies comes ahead of the House of Councillors election slated for the summer.
 

 

Four decades ago, Hiroko Suzuki's father threaded the needle of a U.S. trade war by pushing the family auto-parts business into newer niche products.

Now, tariffs imposed by the Trump administration are so sweeping they threaten her own attempt to diversify the 78-year-old company into medical devices.

Prime Minister Shigeru Ishiba has called the U.S. tariffs, including 25% on automobiles, a "national crisis" for the world's fourth-largest economy. Japan's top trade negotiator, Ryosei Akazawa, headed to Washington on Friday for a third round of talks.

The worry is evident at companies like Kyowa Industrial, a maker of prototype parts and race-car components based in Takasaki, north of Tokyo. Kyowa, which employs 120 people, was among six auto suppliers that told Reuters they were concerned about their ability to withstand the tariff pressure on Japan's car industry.

"What in the world are we going to do?" Suzuki, Kyowa's third-generation president, recalled thinking when the tariffs were announced. "This is going to be bad."

The problems Kyowa and other auto suppliers face illustrate a decades-long shift in Japan, which no longer floods the world with chips and consumer electronics and is reliant on an auto industry threatened by intense Chinese competition. That marks a contrast with the 1980s, when the U.S. slapped trade barriers on a rising Japan and its then-barnstorming exports.

This report, which is based on interviews with a dozen people, including industry executives, bankers and senior government officials, provides a first-hand account of how one firm is grappling with the uncertainty, and details the deepening squeeze on the automotive supply chain at a time of profound disruption.

Kyowa and thousands of other small manufacturers comprise an auto-supply network that has for decades pursued a "monozukuri" (literally, "making things") approach to production. That culture of incremental improvement and assembly-line efficiency, based on methods developed by Toyota, helped make Japan a juggernaut.

But the shift to battery-powered smart cars has meant software, in which EV makers such as Tesla and China's BYD excel, has become a bigger selling point.

Kyowa started developing neurosurgery instruments in 2016 after Suzuki, now 65, realised the rise of EVs would eventually hammer demand for engine components. It began selling the instruments in the U.S. last year, only to find that Trump's tariffs also applied to medical devices.

Kyowa doesn't export auto components to the U.S., but Suzuki worries automakers will force suppliers to cut prices to offset tariffs. So far, that hasn't happened to her.

One Subaru Corp supplier said his company may have to start looking for partners expanding outside the U.S.

Major automakers have largely offered muted support for suppliers since Trump's tariff announcements. Last month, Toyota, Nissan and Ford  sent letters to the U.S. arms of some Japanese suppliers asking for cooperation in the face of tariffs, according to copies reviewed by Reuters, without offering specifics.

The letters haven't been previously reported.

Nissan told suppliers they should stick to previously agreed prices. It said it was "not obliged" to bear the costs of tariffs but that it would shoulder some of the hit for up to four weeks to help secure its supply chain. It added that it could later seek to recover any support payments to suppliers.

Reuters couldn't determine how much support, if any, Nissan extended. The automakers haven't sent follow-up letters, according to two suppliers, who allowed Reuters to review the correspondence on condition of anonymity.
Nissan told Reuters it was working with suppliers to mitigate the tariff impact and contain costs, including through localisation.

Toyota said it would seek to protect its suppliers, dealers, and employees while maintaining customers' trust as it navigated the uncertainty created by the tariffs. Ford told Reuters it was working with suppliers to assess their exposure and potentially reconfigure processes and sourcing.

In its letter, Toyota said it understood the "complexity and financial burden some suppliers are facing" and asked suppliers to identify and share mitigation measures. Toyota would work with suppliers "in good faith", it said.

Some Toyota suppliers, including Denso, have not given earnings forecasts for the coming year, citing uncertainty.

Julie Boote, an analyst at research firm Pelham Smithers Associates, said the trade war posed an "emergency" for Japan's auto industry that would hasten consolidation.

"In order to survive, these automakers will have to work together," she said.

 

SQUEEZED ON COST

Japanese manufacturers traditionally put pressure on smaller suppliers to lower prices, said Sayuri Shirai, a former Bank of Japan board member who is now a professor at Keio University.

If the tariffs remain in place in the longer term, it would spell more damage for regional economies hollowed out by demographic decline, she said.
The risks for Japan are already clear. The economy shrank in the first quarter, and Tokyo has compiled emergency economic measures to ease the pain of tariffs.

"Automobile exports are just too important to Japan for a 25% tariff to stay in place," said David Boling, a former U.S. trade official who is now a director at consulting firm Eurasia Group.

Boling said the U.S. is unlikely to go below the 10% it agreed with Britain.
Trump introduced a 25% tariff on automobiles and later a 24% tariff on all Japanese goods. The latter was slashed to 10% for 90 days, which runs out in July.

Akazawa, the trade envoy, on Tuesday said Japan was sticking to its guns and wanted tariffs eliminated. A White House spokesperson declined to comment on the negotiations.

A U.S. State Department spokesperson said the Trump administration wanted trading partners to align with U.S. efforts to achieve "fairness and balance in our trading relationships and protect U.S. economic and national security."

Two senior Japanese officials told Reuters Japan's auto industry was increasingly looking like a laggard and needed to use the tariffs as an opportunity to implement sweeping changes to catch up with EV rivals.

In a statement, the trade ministry said that regardless of U.S. tariffs, Japan's auto industry needed to respond to significant changes in the competitive environment.

Japan's top auto suppliers, called Tier 1, procure parts from Tier 2 suppliers, and so on down the chain. At the bottom are firms that can be little more than neighbourhood workshops grinding out a single part.

Government officials have previously urged smaller companies to innovate and consolidate, to gain scale.

At regional lender Ashikaga Bank, an automotive industry team supports some 200 companies, around 80% of which are Tier 2 or lower suppliers. A member of the team not authorised to speak publicly said they worried tariffs would lead to higher vehicle prices and a decline in Japanese car sales in the U.S., hitting the bank's clients.

Shinichi Iizuka, president of Toa Kogyo, a suspension maker in Subaru's hometown of Ota, near Takasaki, said the tariff burden will likely be shared by consumers, car dealers, automakers and suppliers.

Some 70% of Subaru's car sales are in the U.S., where it relies on both local manufacturing and imports. On Monday, Subaru said it would raise prices on several U.S. models.

Subaru CFO Shinsuke Toda this month said it was willing to talk with suppliers about sharing their burden, adding the situation remained unclear.


IT'S PERSONAL

Suzuki's drive to diversify Kyowa Industrial into medical devices mirrors the pivot made by her father during the 1980s trade friction, when Kyowa ditched mass production of less-profitable auto parts to focus on higher-margin prototypes and racing-engine components. Suzuki took over in 2000 and her father died in 2013.

Before Trump's tariffs, Suzuki had planned to build a U.S. track record in sales of medical equipment to smooth entry into other markets. With the advent of the U.S. trade barriers, she said her team considered moving production to the U.S., where costs are high, or shifting the sales focus to Asia.

Given the uncertainty around Trump's announcements, Kyowa is in talks with potential distributors in Singapore and Hong Kong, Suzuki said.

Around 70% of Kyowa's business still comes from automakers, while chip-equipment makers and Japan's space program contribute to the remainder. It supplies most Japanese car makers, General Motors and parts for Formula One race cars.

Annual sales are a modest 2 billion yen ($14 million). Still, Kyowa is larger than three-quarters of the roughly 68,000 companies that make up Japan's auto-supply chain, according to research firm Teikoku Databank.

For Suzuki, trade friction is also personal, given her deep affection for the U.S. She grew up listening to rock music on U.S. armed forces radio, learned English and went to university in America. She remembers seeing Aerosmith live at their first concert in Japan.

"Japan and America have a long history of friendship. I hope they can find a solution," she said.
 
 

Toyota Motor Corp on Wednesday unveiled its new RAV4 to the world, with plans to launch the model in Japan before the end of FY2025.

The RAV4 had its beginnings in 1994, when sport utility vehicles (SUVs) were positioned as off-road vehicles. It pioneered the crossover SUV genre for both on-and off-road driving.

Launched in 2019, the fifth-generation RAV4 was developed to further enhance its unique appeal as a model for new lifestyles. It was developed on the concept of a "Robust Accurate Vehicle with 4 Wheel Drive" as a sophisticated blend of the power and utility of an SUV.

It also adopted a new platform based on the Toyota New Global Architecture (TNGA), Toyota's structural innovation within the automobile manufacturing process. It delivered responsive driving performance with maneuverability and stability for any road surface.

Toyota said that under the concept of "Life is an Adventure," this sixth-generation RAV4 seeks to become a vehicle that allows any driver to enjoy an active lifestyle.

The driving experience has been advanced with a newly developed hybrid system that enhances acceleration. 

The key to advancing vehicle intelligence is Arene, Toyota's first software development platform. By utilizing Arene, Toyota aims to achieve a greater level of safety and peace of mind, as well as enrich the mobility experience to make the new RAV4 a companion that fits seamlessly into various lifestyles, whether in urban living or outdoor adventures.
 
 

Japan’s inflation-adjusted real wages fell 0.5 pct in fiscal 2024, which ended in March, from the previous year, down for the third straight year, the labor ministry said Thursday.

Although historic pay increases were achieved in this year’s “shunto” spring wage negotiations in the country, wage growth remained slower than inflation.

Earlier this month, the government set a goal of achieving real wage growth of some 1 pct annually in the five years through fiscal 2029.

While the pace of decline in real wages slowed from a fall of 2.2 pct in fiscal 2023, price hikes for food items such as rice and daily necessities have put pressure on households.

It is uncertain whether the government will be able to achieve the goal, also reflecting persistent uncertainty surrounding the global economy due to the high tariff policy of U.S. President Donald Trump.

In fiscal 2024, nominal monthly wages per worker, including base salary and overtime, rose 3.0 pct to ¥349,388 on average, up for the fourth successive year and marking the steepest increase in 33 years, thanks to the results of the shunto wage talks and higher minimum wages.

Still, the county’s real wages failed to outpace inflation as the consumer price index excluding imputed rent, used to calculate real wages, grew 3.5 pct.

Meanwhile, a real wage index calculated for international comparison using the overall CPI, which includes imputed rent, was unchanged from the previous year, coming out of negative territory for the first time in three years.
 
 

 
Not only rice but most daily commodities have increased in price, which has diminished the popularity of the Japanese government.

Over 100 years ago in Japan, a shortage of rice and a steep rise in its price caused a great uproar for about a month. This has been called the Kome Sodo, or rice riots. Although Japan at the time was not a democratic country, the turmoil adversely affected politics, causing the government of the day to fall.

Present-day Japan is not the same country it was a century ago, and nothing like a desperate clamor for food will happen. But it is true that not only rice but most daily commodities have increased in price, which has diminished the popularity of the government.

An opinion poll conducted by The Yomiuri Shimbun in September showed that more than 90% of respondents felt that rising prices were a burden on households. Those who felt so gave Prime Minister Shigeru Ishiba a low approval rating.

This should be no surprise. At least as far back as the French Revolution, which broke out amid fierce inflation, people suffering severe price increases have been apt to feel anger and distrust toward their governments. Even in recent years, we have seen similar situations in various countries.

After the start of the war in Ukraine and economic recovery from the COVID-19 crisis, a sharp increase in energy and food prices put the world economy in turmoil, damaging the political standing of world leaders, especially in 2023 and 2024, and leading to changes in short-lived governments.

A simple illustration of this pattern is the lineup of national leaders attending the annual Group of Seven summit. At the three summits through 2019, before the pandemic, only two of the leaders were replaced.

But, 11 months after the latest G7 summit, held in June 2024 in Italy, only French President Emmanuel Macron and Italian Prime Minister Giorgia Meloni still remain in their positions.

The other five leaders had been criticized for not dealing with inflation, with some being defeated in their national elections, while others gave up on reelection bids and stepped down because they felt less likely to win.

One of those was then U.S. President Joe Biden, who met a fate similar to that of his predecessors Gerald Ford and Jimmy Carter, both of whom were in office during the oil shock era of the 1970s and failed in their bids to win another term.

In Japan, too, the ruling Liberal Democratic Party and its coalition partner Komeito suffered severe setbacks in the House of Representatives election held in October 2024. In addition to issues of money in politics, many voters held the LDP administration responsible for economic hardship caused by rising prices.

However, inflation is triggered not only by domestic policies but also by exogenous factors such as wars in distant lands, which are beyond the realistic control of governments not a party to them, making it unfair for opposition parties to place the blame for inflation on the incumbent administration.

Japan’s consumer prices in fiscal 2024 rose 3% from the previous year. Because the Japanese economy had been in lingering deflation for more than three decades, inflation started later than in other countries. Also, rising labor costs due to a decline in the working-age population will surely continue to bump up prices.

Ishiba’s administration has no immediate and easy remedy to counter structural inflation without worsening economic conditions. I am sure that Ishiba is afraid of criticism from voters that he lacks an effective economic policy. He has given up on his longtime policy regarding budget discipline. So far, his administration has done nothing but expand government expenditures to ease the grievances and fears of the people.

Another challenging factor is the unpredictable tariff policy of the U.S. government led by President Donald Trump. The policy may be negotiable, but the Japanese government should brace for Trump’s flip-flopping, which has been happening very often.

Now, Ishiba’s minority government consisting of the LDP and Komeito seems to have no other option but to concede to louder voices from the opposition demanding lower tax burdens, even though some economists argue that tax cuts and cash handouts are not desirable ways to deal with inflation. Nearly all parties have been swayed by an economic populism that focuses on short-term benefit.

This is not unique to Japan, but it is not too much to say that it is deplorable that so many politicians are downplaying the serious truth that Japan has huge financial deficits and that large-scale tax cuts will be paid for by future generations that are becoming smaller than the ones preceding them.

The immediate political situation, with the House of Councillors and Tokyo Metropolitan Assembly elections both to be held this summer, has reinforced this tendency.

One of Ishiba’s mentors was Kakuei Tanaka, who served as prime minister from 1972 to 1974 and struggled with skyrocketing prices after the oil shock.

To counter this inflation, Tanaka introduced sweeping tax cuts and expanded social security spending, including pension benefits and medical costs for the elderly. Unfortunately, Tanaka’s measures to stimulate demand made consumer prices even higher in 1974.

The Tanaka-led LDP conducted a vigorous campaign for the upper house election, but the party was defeated. Although the Tanaka administration had a solid majority of seats in the lower house, his popularity had been damaged by a money scandal and he was forced to resign a few months later.

This demonstrates that those who take incorrect measures against inflation to simply please voters are likely to lose on both fronts.

In contrast to Tanaka, who had been a leader of a large faction in the LDP, Ishiba has a weak political base. No one knows how long he can remain in office. In any case, he or his successor will be haunted by the possibility of a 21st-century version of Kome Sodo.

If that happens, all they can do is to choose whether to be criticized for a lack of strategy or to concede to populist policy and repeat the costly mistakes of 1974.
 
 

The monthly number of foreign visitors to Japan hit a record high in April amid the cherry blossom season, a Japan National Tourism Organization report showed Wednesday.

The number of inbound visitors is estimated to have risen 28.5 pct from a year before to 3,908,900 in April, topping 3.9 million for the first time for a single month.

Demand for travel to Japan, especially from China, Hong Kong, the United States and Australia, surged as cherry blossoms bloomed in many parts of the country. The reporting month also included Easter holidays.

By country or region, the number of visitors from mainland China jumped 43.4 pct to 765,100, followed by 721,600 visitors from South Korea, up 9.1 pct, 537,600 from Taiwan, up 16.9 pct, and 327,500 from the United States, up 43.1 pct.

The record monthly figure "seems to be attributed to brisk demand in China for visiting Japan and an increase in the number of flights," Japan Tourism Agency Commissioner Naoya Haraikawa said at a press conference.
 
 

Nissan Motor Co on Monday told employees at its signature Oppama plant in Kanagawa Prefecture that reports of its planned closure were not definitive, according to some workers at the factory.

The struggling Japanese automaker was reported on Saturday to be considering shuttering the plant in Yokosuka and the Shonan plant of its unit, Nissan Shatai Co, in Hiratsuka, raising uncertainty over the future employment and treatment of the workforce.

The country's third-biggest automaker by volume said last week that it will shut seven vehicle plants and cut 20,000 jobs globally after logging a net loss of 670.90 billion yen for fiscal 2024.

Nissan pioneered electric vehicle production at the Oppama plant, which has an annual production capacity of around 240,000 vehicles and employed 3,900 people, including researchers, as of the end of October last year. The Shonan plant builds commercial vehicles.

The prefectural government held an emergency meeting on Monday to discuss offering consultation and reemployment services in reaction to the potential closures.

"If they really do close, it will have a huge impact on employment and the economy," Kanagawa Gov Yuji Kuroiwa said at the meeting. "We will consider our options from a multitude of angles."

Following the discussions, Kuroiwa told reporters that Nissan contacted the prefecture on Saturday after the initial reports. Nissan officials visited the prefectural office on Monday to inform it that nothing has been decided.

The prefectural government conveyed to Nissan its hope that the automaker will endeavor to limit the consequences of its actions.

During a regular press conference on the same day, Yokosuka Mayor Katsuaki Kamiji emphasized the importance of the more than 60-year history of the Oppama plant and said he hoped it would be "restored to its former brilliance."

Nissan officials also visited the city on Monday.
 
 

The Economy, Trade and Industry Ministry will from fiscal 2028 introduce a car fuel partly mixed with biofuels made from corn, sugarcane and other biomass.

The fuel, which would mix gasoline with up to 10% biofuels, will be available in selected areas and is expected to be introduced where oil refineries and oil tanks are located.

The plan is aimed at building momentum to decarbonize the transport sector, which is responsible for about 20% of the country’s carbon dioxide emissions. The ministry will include the policy in its action plan for introduction of biofuels, which will be announced at a forthcoming expert panel meeting.

The government initially drew up plans in November last year to start providing fuels containing up to 10% biofuel in fiscal 2030. About 40% of new vehicles sold in the country are compatible with the fuel mixture.

The ministry’s decision to introduce the fuels two years earlier is intended to identify potential issues regarding safety, quality maintenance and transport systems among others to allow the subsequent plans to go smoothly.

Areas where the fuel will be introduced will be decided on by autumn, and financial support will be provided for the costs involved, such as renovating fueling stations. The government has already received approval for the plan from oil wholesalers and carmakers.

To expand use of biofuels, it is necessary to raise its mixture rate even higher. The government is planning to ask carmakers to make all new vehicles compatible with mixed fuels with 20% biofuels in the early 2030s and intends to start providing such mixed fuels in fiscal 2040.

Biofuels are made from biological resources, such as corn and sugarcane. Biofuels emit CO2 when burned but they are regarded as making de facto contributions to decarbonization because CO2 is absorbed by their biological ingredients when they grow.

The use of biofuels is spreading worldwide. Countries such as Brazil and the United Kingdom have made it mandatory to offer mixed fuels containing a certain percentage of biofuels.

Japan has a policy to procure biofuels from Brazil, the United States and elsewhere, but stable procurement and cost reduction will be problems to overcome if Japan is to make biofuels widely available.
 
 

Japanese automakers have few immediate options to offset the impact of the additional U.S. tariff on cars. Toyota Motor Corp, Honda Motor Co and other domestic manufacturers will likely rely on strong sales of their popular fuel-efficient models in the key market, potentially coupled with price increases, analysts say.

An additional 25 percent tariff that took effect on April 3 is expected to significantly dent profits at Japanese automakers, with Japan's top two carmakers -- Toyota and Honda -- projecting a 35 percent and 70 percent plunge in net profit, respectively, for the year through March 2026.

Auto manufacturers can increase local production or pass the higher tariff costs on to customers, among other effective measures to mitigate the impact.

Raising prices could help ease the pressure on profitability, but the strategy risks driving away customers.

Toyota Chief Financial Officer Yoichi Miyazaki said at a press conference on the company's latest earnings that it would not make any hasty moves and ruled out an immediate price hike, describing it as a risky strategy.

It may take years to increase local production, as carmakers will need to reorganize their supply chains, and they may be reluctant to do so without knowing how long the tariffs will remain in place, analysts said.

On top of the 25 percent tariff, U.S. President Donald Trump imposed a 25 percent tariff on auto parts and a 10 percent baseline rate for imports from all trading partners.

Toyota President Koji Sato said at the press conference that his company will continue to focus on local development and production "in the medium and long term."

If exports from Japan to the U.S. market prove difficult, Toyota should consider redirecting those vehicles to other markets in the short term, he said.

Toyota, the world's largest carmaker by volume, expects its net profit to fall 34.9 percent in the current fiscal year to 3.1 trillion yen ($21.3 billion), as it estimates the higher import taxes will reduce its operating profit by at least 180 billion yen in the first two months of the fiscal year. The company did not disclose the impact for the full year.

Honda, Japan's No. 2 carmaker, said its net profit is forecast to plunge 70.1 percent to 250 billion yen in fiscal 2025, saying that U.S. tariffs could lower its operating profit by 650 billion yen in the year, affecting its imported cars and motorcycles.

Honda plans to move production of some models to the United States from Japan and Canada to soften the impact of the tariffs.

Honda President Toshihiro Mibe said the company will also consider raising prices, closely monitoring other firms' pricing strategies to determine the timing and which models would be affected.

"We will make efforts to overcome" the impact of the tariffs, Mibe said at a press conference for the latest earnings.

Nissan Motor Co, Japan's third biggest carmaker, expects the tariffs to cut its operating profit by up to 450 billion yen in the current business year.

The additional tariffs are another blow to Nissan, which has been undergoing massive restructuring due to faltering sales in the U.S. and China markets.

The struggling automaker posted its third-largest net loss in fiscal 2024.
Nissan said it will focus on boosting sales of models manufactured in the United States to cushion the effect of the auto tariff.

Nissan builds 53 percent of the vehicles it sells in the U.S. market at local plants, more than Toyota's 49 percent but less than Honda's 62 percent, according to Tatsuo Yoshida, senior auto analyst at Bloomberg Intelligence.

For Japanese automakers, scaling back their U.S. operations is not an option. Demand for relatively high-end vehicles, which offer higher profit margins, remains strong in the world's second-largest auto market after China, analysts say.

Auto analyst Takaki Nakanishi of the Nakanishi Research Institute said the challenging circumstances do not diminish the importance of the U.S. market for Japanese automakers, and that Toyota and others should continue offering attractive products to local customers to remain competitive.

No Japanese automakers currently plan to build new plants or significantly expand production capacity in the United States, as they aim to boost sales of small cars and hybrid vehicles to meet strong local demand.

"The tariff was imposed at a time when Japanese automakers' shares and sales in the U.S. market were expected to grow into 2025 with local consumers opting for smaller cars and hybrids that Japanese automakers have an edge on," Bloomberg Intelligence's Yoshida said.

"Since the additional tariff imposed by the Trump administration is not driven by hostility toward Japan-made cars, there is no reason for Japanese automakers to shift their stance. The U.S. market will remain a key source of sales, even if profits take a hit from the levies," he said.
 
 

The Finance Ministry is considering imposing the consumption tax on low-cost imported goods priced at ¥10,000 or less that are currently exempted under the de minimis rule, according to sources.

The ministry is set to revise the rule, which also exempts such goods from tariffs.

Behind the move is the situation in which Chinese e-commerce sites are boosting their sales of low-cost items under the rule. The ministry aims to level the playing field for competition between domestic and foreign businesses.

Other countries are also making changes to their de minimis rules. The administration of U.S. President Donald Trump suspended the de minimis rule for items imported from China.

Regarding the timing of making the change, the ministry is eyeing the government’s tax reform scheduled for next year or later. The ministry is considering making it mandatory for businesses managing e-commerce sites to register with the tax authority and file their tax.

The ministry is set to continue tariff exemptions, because the imposition of tariffs creates additional on-site workloads.

“De minimis” means “about minimal things” in Latin. Similar systems have been introduced in many countries to reduce the burden of customs clearance work.

Japan currently exempts imported items priced at ¥10,000 or less from a tariff and the consumption tax. According to the ministry, there were 169.66 million cases — worth ¥425.8 billion — of imports of low-cost goods priced at ¥10,000 or less in 2024, five times larger than five years ago.

Experts point out that Temu, Shein and other Chinese e-commerce sites have been increasing sales of low-cost items in recent years, taking advantage of the de minimis rule of various countries.

According to research firm Sensor Tower, Temu’s e-commerce application was the most downloaded app worldwide last year, with 550 million downloads, followed by Shein.

According to the ministry, many domestic businesses are apprehensive about the situation regarding Chinese sites.

“Their price competitiveness is strong, and they pose a threat to us. It’s possible that they could take more market share,” a domestic business said.
“The imbalance of competitiveness has too much of an impact,” another said.

An increasing number of countries are abolishing or diminishing the rule. The U.S. government suspended tax exemption for Chinese goods from May 2 to eliminate a loophole in its tax system. Vietnam abolished the system in February, and the EU is also trying to revise its rule.
 

 

Japanese technology and entertainment company Sony Corp logged an 18% rise in profit for the fiscal year through March on healthy results at its music and video-game operations.

Its chief executive, Hiroki Totoki, outlined the company's strategy for growth Wednesday, stressing that collaboration among Sony's various segments, like animation and music, were crucial to deliver the “kando,” or emotional engagement, that lies at the core of the company's vision and strength.

“Building on our momentum and results to date and working with a laser-like focus to realize our long-term Creative Entertainment Vision will be at the core of our corporate strategies moving forward,” he told reporters.

Sony's movies division has strong offerings in the pipeline, including Spider-Man films and biopics about The Beatles, while animation remains a driver of growth centered around the popular anime streaming service Crunchyroll, Totoki said.

Tokyo-based Sony reported a record annual profit of 1.14 trillion yen ($7.8 billion), up from 970.6 billion yen in the previous fiscal year. Annual sales were virtually unchanged, inching down to 12.957 trillion yen ($88 billion) from 13.020 trillion yen.

One area that lagged among Sony’s sprawling businesses was the financial segment, where revenue stalled. But its film division and its imaging and sensor solutions segment did well.

Sony officials said they were studying how to respond to President Donald Trump's tariffs, although that was a challenge because of uncertainties and constant changes. But they said the negative impact from U.S. trade policy will be kept to 10% of Sony's operating profit in the coming fiscal year by adjusting the allocation of shipments, among other measures.

Totoki stressed that Sony plans to leverage its content creating technology, like virtual reality and image sensors, to feed into its entertainment products, including working on immersive experiences.

Sony also has powerful collaborative relations with various entertainment companies like Kadokawa, which includes publishing as well as films and animation, and Bandai Namco, a video game maker, he added.

Sony will emphasize the “diversity” of its workers, helping bring out people's creative potential, Totoki said.

Among the Sony movies that fared well at the box office for the fiscal year through March were “Venom: The Last Dance,” featuring the Marvel Comics superhero, and “Bad Boys: Ride or Die,” an action comedy, where Will Smith and Martin Lawrence return in their popular cop roles in the fourth installment in the series.

Sony, which makes the PlayStation console and game software played on that machine, also posted healthy results in the gaming business.

Its music operations, which also held up, include recordings, streaming services and music for games. The top-selling recorded music projects for the latest fiscal year globally was SZA’s “SOS Deluxe: LANA,” followed by Beyonce, Future & Metro Boomin and Travis Scott.

The top seller in its Japan music business was Kenshi Yonezu’s “Lost Corner” album, followed by offerings from Stray Kids and Six Tones.

For the January-March quarter, Sony posted a 197.7 billion yen ($1.3 billion) profit, up 5% from 189 billion yen the same quarter in the previous fiscal year. Sales were 2.6 trillion yen ($17.7 billion), down 24% from 3.48 trillion yen.

Sony is forecasting a nearly 13% drop in profit for the fiscal year through March 2026, to 930 billion yen ($6.3 billion), on 11.7 trillion yen ($80 billion) sales, down 2.9% on-year.

Sony Group Corp stocks, which fell in Tokyo morning trading, rebounded to finish 3.7% higher after its financial results were announced.
 
 

Honda Motor on Tuesday forecast a 70 percent drop in net profit for the 2025-26 financial year as U.S. trade tariffs weigh on the global auto industry.

The announcement comes after rival Toyota, the world's top-selling carmaker, predicted a 35 percent year-on-year drop in annual net profit because of the levies and other factors.

Honda said it expected net profit of 250 billion yen in the 12 months to March 2026.

"Tariff impact and recovery efforts" will have a negative effect on operating profit, it warned, estimating they will cost the company around 450 billion yen over the year.

In an attempt to rev up the U.S. auto industry, President Donald Trump last month imposed a 25 percent toll on imported vehicles, dealing a major blow to Japanese carmakers.

"The impact of tariff policies in various countries on our business has been very significant, and frequent revisions are being made, making it difficult to formulate an outlook," CEO Toshihiro Mibe told reporters Tuesday.

Honda, Japan's second-biggest automaker after Toyota, logged net profit of 835 billion yen in the past financial year, a drop of almost 25 percent on-year and well short of its February forecast of 950 billion yen.

"Our automobile business experienced a decline in sales volume mainly in China and the ASEAN region" in Southeast Asia, Mibe said.

It was also "impacted by increased incentives for EV sales in North America", although "hybrid vehicle sales expanded".

But Honda may still have a better chance of weathering Trump's tariff onslaught than its competitors in Japan, analysts said.

Late last month Trump softened the auto tariffs by signing an executive order to limit the impact of overlapping levies on carmakers.

He also said he would give the industry a two-year grace period to move supply chains back to the United States.

This is good news for Honda, which builds more than 60 percent of the vehicles it sells in the United States in the country.

That is "the highest percentage" of all major Japanese automakers, Bloomberg Intelligence auto analyst Tatsuo Yoshida told AFP ahead of the results.

That means the impact from tariffs will be "comparatively smaller for Honda", he added.
 

 

Struggling Japanese automaker Nissan Motor Co plans to cut around 20,000 jobs globally, more than 10,000 above the reduction announced last fall, as it deems deeper action is needed to turn its business around, a source familiar with the matter said Monday.

The job cuts under the new plan represent about 15 percent of Nissan's total workforce. The company is set to report its earnings for the fiscal year ended March on Tuesday, with attention focused on the impact of U.S. President Donald Trump's higher auto tariffs.

The automaker is also considering closing one of its domestic factories as part of efforts to optimize production capacity amid declining sales, the source said.

In November, Nissan announced plans to cut 9,000 jobs in Japan and overseas and to reduce its global production capacity by 20 percent by fiscal 2026, as its businesses in the United States and China continued to struggle.

In February, it said it also plans to close a Thai plant and two other factories without giving details.

Nissan currently operates five vehicle assembly plants in Japan, with former CEO Makoto Uchida previously expressing a commitment to keeping domestic factories in operation.

The plan to close a domestic plant is expected to draw strong opposition from labor unions and other stakeholders, likely making coordination difficult.

Last month, the automaker projected a net loss of 700 billion yen to 750 billion yen for fiscal 2024 due to restructuring costs, which would be the company's biggest-ever annual net loss.

Nissan has been reviewing its investment strategy under CEO Ivan Espinosa, who assumed Nissan's top post on April 1.

It said last week it has abandoned a plan to build an electric vehicle battery plant in Fukuoka Prefecture, only a few months after signing a pact with local governments over the envisioned facility.

Nissan sought to merge operations with rival Honda Motor Co, but their negotiations broke down in February after Honda's proposal to make Nissan its subsidiary riled the Yokohama-based automaker's board.
 
 

Japan is seeing a boom in gold investment amid heightening concerns over a global economic slowdown caused by U.S. President Donald Trump's hefty tariffs, as investors seek a safe asset seen as unlikely to plummet in the event of turbulence.

The benchmark price of gold set by Tokyo's Tanaka Precious Metal Technologies Co. hit an all-time high in yen terms on April 22, exceeding 17,000 yen ($115) and surging around 15 percent in the three months since Trump took office on Jan. 20.

Products linked to gold price movements have also become popular among investment trusts covered by Japan's tax exemption program for private investors, known as NISA, while more people have started monthly investments in pure gold.

Among investment trusts, the inflows to the Mitsubishi UFJ fine gold fund that reflects gold prices totaled some 19.2 billion yen in March, up by about 2.6-fold from last December.

The fund ranked fourth last December in investment trusts under the NISA program in terms of value handled by PayPay Securities Corp. but topped the ranking in February and placed second in the following month, it said.

At Tanaka Precious Metal, the number of people who purchased bullion and coins increased, while the number of its members investing in pure gold at fixed monthly values expanded 26 percent in the January-April period from a year earlier, it said.

Used gold accessories are also becoming popular. At major second-hand luxury brand goods seller Komehyo Co., sales of gold products including accessories in March climbed 30 percent from a year earlier.

In Tokyo's Shinjuku district, one of its outlets sells a wide selection of products from gold necklaces and gold pendants, with price ranging from hundreds of thousands to millions of yen.

"They are mainly sold to customers in their 30s to 40s," the store's sales manager said.

Gold also has the risk of price declines like other assets but its prices have been solid at a time when the stock market has been volatile, with the Nikkei benchmark suffering its third-largest point drop in history on April 7.

"Considering the volatility in the stock market, gold continues to remain an attractive investment destination," said Atsuko Sato Whitehouse, head of the Japanese market at BullionVault.
 
 

Japan posted a record current account surplus of 30.38 trillion yen ($208 billion) in fiscal 2024, marking a high for the second consecutive year, buoyed by its biggest-ever returns on foreign investments, government data showed Monday.

In the year ended March, the surplus in the current account balance, one of the widest gauges of international trade, grew 16.1 percent from the previous year, hitting the highest level since comparable data became available for fiscal 1985, the Finance Ministry said.

Primary income, which reflects how much Japan earned from overseas investments, stood at a record-high 41.71 trillion yen, up 11.7 percent from a year earlier, driven by increased dividends from offshore subsidiaries amid a weak yen, the ministry said in a preliminary report.

The yen averaged 152.48 against the U.S. dollar in fiscal 2024, 5.5 percent weaker than the year before, with the Japanese currency's depreciation inflating the value of returns from foreign investments by domestic companies and overseas dividend income.

Among other key components, the goods trade balance registered a deficit of 4.05 trillion yen, expanding 9.8 percent, as imports climbed 4.3 percent to 110.29 trillion yen, supported by strong demand for personal computers and smartphones.

Exports rose 4.1 percent to 106.24 trillion yen, helped by shipments of semiconductor-making equipment, electronics parts and vehicles.

The country's services trade deficit fell 20.2 percent to 2.58 trillion yen due to an expansion of the travel surplus, which stood at a record 6.69 trillion yen. Around 38.85 million foreign tourists visited Japan in fiscal 2024, up 34.7 percent from a year earlier, according to the ministry.

A surplus in the travel balance means that spending in Japan by foreign visitors exceeded the amount spent overseas by residents of Japan.
In March alone, the country logged a 3.68 trillion yen current account surplus, the third highest for any month, the ministry said.
 
 

The government is enhancing a system to encourage middle-aged workers in major companies to move into positions at midsize and small companies in provincial regions.

The enhanced program also upgraded a scheme for compensating transferees who are concerned that their salaries will decrease if they were to take up the new positions.

With the upgraded system, the government hopes that businesses in provincial areas will better utilize the workers’ high-level expertise.

In September last year, Hitoshi Nakayama, 53, left a position as chief of the general affairs division of a major auto parts manufacturer to take a job at Tobu Trading Co., a firm based in Matsubushi, Saitama Prefecture, that handles industrial waste.

“I wanted to utilize my experiences and skills in accounting and facility management,” Nakayama said.

He registered with REVICareer, a human resources database operated by Regional Economy Vitalization Corporation of Japan, and a job search firm that is part of the Chiba Bank group found him in the database and introduced him to Tobu Trading, with which the bank has business dealings
.
“We were looking for a talented, skilled worker who could collaborate with other divisions in our company,” said Koji Iwamoto, executive officer of Tobu Trading. “We regularly cooperate with the bank. So we had a high level of trust in its introduction.”

REVICareer, a Financial Services Agency project, began operating in fiscal 2021.

To be eligible to register with the database, the candidate has to have worked at a company with at least ¥1 billion of capital or more than 2,000 employees, or at a subsidiary of such a company. Once registered, job seekers can search for a new job using the database for a period of five years starting from when they leave their workplace.

The information of job seekers registered with the database can be accessed by 156 financial institutions, including regional banks and shinkin banks. The banks can then use that information to find job seekers who are suitable for the needs of their business partners and introduce both sides.

The program also allows the job seekers to take on the new positions as side jobs or concurrent primary occupations while remaining in their full-time positions.

Mismatches between the job seekers and the employers are said to be rare because their introductions are mediated by regional financial institutions that have detailed knowledge about the realities faced by midsize and small firms in the regions.

Differences in salaries and working conditions had been high hurdles for workers moving from major companies to smaller firms. To address this, the Financial Services Agency pays a portion of the salaries of workers who change companies using the database.

Under certain conditions, the workers can receive 30% — up to ¥4.5 million — of their new job’s annual salary from the agency for two years after assuming their new post.

As of the end of fiscal 2024, 4,343 workers were registered in the database, with the average age being 54. The total number of cases in which job seekers changed jobs or found side jobs was 178, a 2.5-fold increase from the 72 cases logged as of the end of fiscal 2023.

The agency has now tripled the program’s budget to ¥2 billion and partnered with the Economy, Trade and Industry Ministry.

The agency, through business organizations and chambers of commerce under the ministry’s jurisdiction, aims to encourage midsize and small companies in provincial regions to proactively offer jobs.

Nevertheless, the number of registered job seekers in the REVICareer database is significantly lower than in private-sector job-brokering services, so raising its name recognition is a pressing challenge.

Until last fiscal year, the conditions for job seekers to use the database were limited to current employees of major companies or those who had left jobs at major companies in the past two years. The conditions have been relaxed from this fiscal year to enable the registration of job seekers who have left a major company in the past five years.

An agency official connected to REVICareer said, “We want to increase the number of registered people to about 10,000 and accelerate the revitalization of regional communities.”
 

 

Given that the automotive industry serves as the “backbone” of the Japanese economy, a decline in its performance could undermine the drive for higher wages in the country.

With its extensive reach encompassing global corporations such as Toyota Motor Corp. and numerous small- and mid-sized parts suppliers, the industry supports 5.58 million jobs.

Japan’s annual automobile exports are worth about ¥20 trillion, accounting for 20% of the country’s overall exports. Of the exported units, 30% are destined for the United States, making it a significant market.

Amid this situation, the United States imposed an additional 25% tariff on automobiles on April 3 and on auto parts on May 3.

Recent figures reflect emerging macroeconomic challenges. As a result, the Bank of Japan significantly lowered its fiscal 2025 projection for econmic growth from 1.1% to 0.5%.

According to estimates by Daiwa Institute of Research Ltd., the implementation of “uniform reciprocal tariffs” of 10% by the United States is expected to lower Japan’s growth rate by 0.3%.

Sector-specific tariffs on automobiles and steel, among others, would lead to an additional 0.45% decrease.

The impact from tariffs on automobiles alone accounts for 0.36 percentage points, or 80%, of this decrease due to that industry’s high dependence on exports to the United States.

“Automobile tariffs will have the most substantial negative impact on the Japanese economy,” said Shinichiro Kobayashi of Mitsubishi UFJ Research and Consulting Co.

“The substantial involvement of small- and medium-sized enterprises in parts manufacturing could result in considerable damage to the real economy, underscoring the urgent need to protect this sector,” he said.
Major automakers, led by Toyota, have enjoyed strong performance due to the weak yen and have led the trend of significant wage increases in recent spring labor negotiations.

However, should they lose momentum due to adverse conditions such as tariffs and a stronger yen, the nationwide drive for higher wages could diminish, potentially resulting in reduced personal spending.

“The wage increases that have become established are in danger of being rolled back,” said Japan Chamber of Commerce and Industry Chairman Ken Kobayashi.

The United States has said it will not include automobile tariffs in the agenda for trade negotiations with Japan, raising expectations for challenging discussions.

Economic revitalization minister Ryosei Akazawa expressed growing concern, saying: “[Major automobile manufacturers] are incurring hourly losses. We seek to conclude this matter with utmost haste.”
 
 

Japanese electronics giant Panasonic, which supplies batteries to Tesla, said Friday it will target 10,000 job cuts worldwide as part of efforts to boost profitability.

The cuts, which represent around four percent of the group's workforce of nearly 230,000, will be implemented mainly in the current financial year to March, it said.

Panasonic said it would "thoroughly review operational efficiency at each group company, mainly in sales and indirect departments".

It will "reevaluate the numbers of organizations and personnel actually needed", a statement said.

"This measure targets 10,000 employees (5,000 in Japan and 5,000 overseas) at consolidated companies," and will be executed "in accordance with the labor laws, rules, and regulations of each country and region".

Panasonic became a global household name in the latter half of the 20th century, pioneering electronic appliances from rice cookers to televisions to video recorders.

The Osaka-based conglomerate is a major battery supplier for Elon Musk's U.S. electric vehicle maker Tesla, and also operates in the housing, energy and auto sectors.

Panasonic in February outlined a management reform program to resolve "various structural issues" at the company.

"Through the current management reform, the company aims to improve profit by at least 150 billion yen," it said Friday.

In its full-year earnings report, also released Friday, Panasonic forecast a 15 percent decline in net profit this year, and an eight percent slump in sales.
In the financial year to March 31, 2025, the group logged a 17.5 percent decline in net profit to 366 billion yen.

Panasonic is facing "ongoing business environment changes (such as) a slowdown in demand for EVs", it said.

As for U.S. trade tariffs, "their impact is not factored into this forecast", Panasonic added.

"The company continues to monitor the tariff situation and aims to minimize the resulting impact by taking measures from both short-term and medium- to long-term perspectives."

In an interview published in April, Panasonic Holdings CEO Yuki Kusumi told Japan's Nikkei newspaper that personnel cuts would be necessary, without detailing their scale.

Job cuts would be needed "in order for us to perform at a competitive level against other firms", he told the Nikkei.

In Panasonic's history, the group has also gradually expanded its headcount during profitable periods, Kusumi stressed.
 


 

NTT Corp. plans to fully acquire information technology services provider NTT Data group Corp. in a transaction projected to be worth about ¥2.37 trillion, the company announced Thursday.

NTT Data Group is a publicly listed subsidiary of NTT. Following the acquisition, it will likely be delisted from the stock exchange.

This strategic move is meant to expedite the convergence of telecommunications and information technology services to foster growth.
The core operations of NTT Data Group involve delivering IT services and managing data centers, primarily for corporate clients within the nation. It also oversees the NTT Group’s overseas businesses.

NTT currently holds a 57.7% equity stake in NTT Data Group and intends to acquire the remaining shares through a tender offer.

NTT has been intensifying its group restructuring initiatives, including the full acquisition in 2020 of NTT Docomo Inc., a previously listed subsidiary. Subsequently, the group centralized its international operations under NTT Data Group in 2022.

The accelerating digitization of businesses has favorably impacted NTT Data Group, resulting in strong performance and sustained growth in both revenue and profit.

For the fiscal year that ended in March 2025, the company projects consolidated revenue of ¥4.43 trillion, representing a 1.4% year-over-year increase. Operating profit, a key indicator of core earnings, is projected to reach ¥336 billion, marking an 8.5% year-over-year increase.
 
 

Japan's real wages in March fell 2.1 percent from a year earlier, marking the third consecutive monthly decline, as income growth continued to fall behind price hikes, government data showed Friday.

Nominal wages, or the average total monthly cash earnings per worker including base and overtime pay, increased 2.1 percent to 308,572 yen, rising for the 39th straight month, the Ministry of Health, Labor and Welfare said.

But consumer prices, used to calculate the pay data, grew 4.2 percent in the reporting month, driven by higher rice and other food prices, although the pace slowed from a 4.3 percent rise in February, according to the ministry.

Separate data showed the country's household spending in March rose a real 2.1 percent from the year before.

Households of two or more people spent an average of 339,232 yen in the reporting month, according to the Ministry of Internal Affairs and Communications.

The data is a key indicator of private consumption, which accounts for more than half of Japan's gross domestic product.
 
 

KDDI Corp. has started a service for the direct connection of smartphones with the Starlink satellite network of SpaceX of the United States.

It is the first time in Japan that smartphone connection services using satellites has become available. Even in places that were out of the service areas of mobile phones in the nation, some kinds of message information can be transmitted and received.

From summer this year, KDDI will make it possible for its smartphone subscribers to access the internet.

Subscribers to KDDI’s au brand smartphones can use the new service free of charge for the time being.

Although applications do not need to be made for the new service, subscribers need to use iPhone models of Apple Inc., Galaxy models of Samsung Electronics Co. or other models that are compatible with Starlink.

In the direct connection service, smartphone subscribers can transmit and receive radio waves via Starlink satellites without accessing wireless access points.

Even in out-of-service places, such as mountainous areas and on the sea, KDDI subscribers can transmit and receive short message service texts, share location information and receive emergency earthquake warnings.

Subscribers using smartphones with the Android operating system of Google LLC can send texts of questions to conversational AI programs.

Prior to rolling out the new service, KDDI provided antennas for Starlink connection to areas damaged by the Noto Peninsula Earthquake.
 
 

Indonesian Finance Minister Sri Mulyani Indrawati and Japanese Finance Minister Katsunobu Kato discussed the challenges posed by the US tariff policy in Milan, Italy, on Sunday.

On the sidelines of the ASEAN+3 Finance Ministers’ and Central Bank Governors’ Meeting, Sri Mulyani noted that Japan’s experience in dealing with the trade war with the US in the 1980s offers valuable insights and is an important reference in shaping the steps forward.

“(During the meeting) I conveyed that Indonesia received a positive response from the US government as one of the first mover countries that proactively negotiate tariffs,” she wrote on her Instagram account.

As part of the negotiations, Sri Mulyani highlighted that Indonesia has prepared a comprehensive policy package addressing various issues, including tariff and non-tariff barriers, as well as tracking the US trade deficit.

"Our discussion also covered the impact of escalating tariff wars on the automotive and electronics industries that have long been pillars of global trade and dominated by the US, Japan, China, and Europe,” she stated.

Earlier, Sri Mulyani stated that Indonesia's bargaining position remains neutral amid tensions between the US and China over reciprocal tariffs.

"Indonesia, both as the largest country in ASEAN and in its relations with the US and China, which are experiencing escalating tensions, maintains a fairly neutral position that is respected and taken into account,” she noted.

“This is a good bargaining power that we must maintain," she stressed.

She expressed optimism that Indonesia's relatively strong bargaining position is supported by its stable economic performance. With this support, Indonesia has sufficient capital to face the dynamic and tense global situation.

So far, the Indonesian government and the Office of the US Trade Representatives (USTR) have signed a non-disclosure agreement, marking the start of the technical discussion phase set to take place in the next two weeks.

The agreement resulted from negotiations between the Indonesian and US governments following President Donald Trump’s announcement to impose reciprocal tariffs on numerous countries, including Indonesia, which now faces a 32 percent tariff.

However, on April 9, Trump announced a 90-day pause on the policy’s implementation for most countries, excluding China. Indonesia is among the countries granted the full three-month reprieve.
 

Sumitomo Mitsui Banking Corp (SUMFGI.UL) (SMBC) is close to agreement on acquiring a stake in Yes Bank with the Japanese firm eyeing a majority 51% equity in the Indian lender, three sources familiar with the deal said on Tuesday.

If the deal goes through, it could potentially be the largest in India's banking sector, where deal-making, especially involving foreign entities, is rare.

Shares of Yes Bank soared nearly 10% at one point on Tuesday. They were up 1.6% as of 1 p.m. local time (0730 GMT), valuing the lender at 565 billion rupees ($6.7 billion).

Restrictions on ownership, stricter capital requirements, and state domination of the banking sector have curbed foreign banks' operations in India. A takeover of troubled Lakshmi Vilas Bank by Singapore-based DBS Group in 2020 was the last major deal in the sector.

SMBC, a unit of Sumitomo Mitsui Financial Group Japan's second-biggest bank, has been in discussions with Yes Bank's largest investor, State Bank of India and India's central bank since last year, but the negotiations faltered amid concerns over ownership and voting rights.

Now, the Reserve Bank of India (RBI) has given SMBC a verbal go-ahead and a deal structure would be announced by June, one of the sources said.
Another source said SBI "is negotiating with SMBC to chalk out the final contours of the deal, but is yet to take the proposal to the board."

Yes Bank, in an exchange filing, said that it "routinely explores opportunities" with various stakeholders, which are aimed at enhancing shareholder value. However, such discussions are "preliminary" and do not warrant disclosures, it said.

The information pertaining to these discussions is "speculative" at this time and are not factually correct, Yes Bank said, referring to reports in various media on the potential deal.

None of the sources wished to be identified as the talks are private. The RBI, SMBC and SBI did not immediately respond to Reuters' emails seeking comment.

SBI holds a 24% stake in Yes Bank, as a result of the regulator-led restructuring of the lender in March 2020.

ICICI Bank (ICBK.NS), opens new tab, HDFC Bank (HDBK.NS), opens new tab, Kotak Mahindra Bank (KTKM.NS), opens new tab, Axis Bank (AXBK.NS), opens new tab and Life Insurance Corporation of India (LIFI.NS)

, opens new tab together hold an 11.34% stake in Yes Bank.
Indian regulations need the largest shareholder of a bank to reduce their shareholding to 26% in 15 years.

For the SMBC-Yes deal, "the RBI is clear" that the Japanese firm's voting rights will be capped at 26%, the first source said.
 
 

Japanese Prime Minister Shigeru Ishiba will have to continue dealing with a host of difficult issues at home and abroad after the country's Golden Week holiday period ends Tuesday.

The course of Japan-U.S. negotiations on the high tariff policy of the administration of U.S. President Donald Trump is the biggest of the challenges facing the Ishiba government.

The outcome of the ongoing bilateral negotiations will certainly have a major impact on this summer's election for Japan's House of Councillors, the upper chamber of the Diet, the country's parliament, and may affect the fate of the Ishiba administration, political watchers say.

"We are discussing all (U.S.) tariff measures, including tariffs on automobiles, steel and aluminum," Ishiba told reporters at his official residence Saturday, reiterating Tokyo's stance of calling on the U.S. side to review its tariff measures.

The gap between Tokyo and Washington is large, however, as the U.S. side apparently plans to put so-called reciprocal tariffs on the agenda of the bilateral negotiations while not including automobile, steel and aluminum tariffs from the scope of topics.
 
 

Japan Airlines Co. said Friday its revenues rose 11.6 percent from the year before to 1.84 trillion yen in the fiscal year ended March, a record high since its relisting in 2012, boosted by robust demand from domestic and international travelers.

The company said it remains vigilant over the possible effect of U.S. President Donald Trump's tariffs policy on travel and cargo demand, saying the latest earnings results have not reflected the impact of the "extremely uncertain" and fluctuating Trump policies.

CEO Mitsuko Tottori told a press briefing that the latest result gave her "confidence" to pursue further growth as it reflected continued support by customers despite incidents of pilots drinking alcohol that prompted a business improvement order from the transport ministry.

Tottori said she hopes that the World Exposition in Osaka, running for six months from mid-April, will further boost inbound travelers, not only to the western Japan city but also to other regions in Japan using domestic airline services.

JAL's net profit for fiscal 2024 grew 12.0 percent to 107.04 billion yen. The number of domestic passengers increased 2.9 percent to 36.13 million, and international travelers rose 14.4 percent to 7.58 million.

The figures picked up from fall and winter seasons after some people likely avoided traveling during the hot Japanese summer, the company said.

For the current fiscal year that began in April, the company expects its net profit to rise 7.4 percent to 115 billion yen on sales of 1.98 trillion yen, up 7.2 percent.
 
 

The Bank of Japan is closely monitoring U.S. tariff policy, as it could impact the timing of Japan’s rate hikes given the significant uncertainty the tariffs inject into the economic and price outlook.

At a press conference on Thursday, BOJ Gov. Kazuo Ueda reaffirmed that the bank would consider raising interest rates once it believes that its economic and price outlook will be realized.

However, given the major turmoil stirred up by U.S. tariffs, market observers have expressed divergent views about when interest rates will be hiked.


Outlook uncertain

The BOJ’s Outlook Report, released on Thursday, presented revised projections of inflation: 2.2% for fiscal 2025, 1.7% for fiscal 2026 and 1.9% for fiscal 2027. Notably, these forecasts have been revised downward for fiscal years 2025 and 2026 compared to the report issued in January.

During the press conference, Ueda said that the BOJ would be “slightly delayed” in reaching its target of stable 2% inflation, with that result now being expected between late fiscal 2026 and the end of fiscal 2027.

However, Ueda did not clarify whether rate hikes would be put off. This lack of clarity stems from the uncertainty associated with U.S. tariffs, which could prompt significant changes to the economic and price outlook.

“Considering the somewhat limited certainty of the [economic and price] outlook, there is a substantial probability that changes in conditions, such as tariffs, will require revisions to the outlook,” said Ueda.


Divided views

At its latest policy board meeting, the BOJ remained firm on raising the policy interest rate if “underlying inflation,” which excludes temporary factors such as rising rice prices, approaches 2%.

According to Shinichiro Kobayashi of Mitsubishi UFJ Research and Consulting Co., the prospect of a rate hike this year has almost vanished. He believes an economic slowdown is inevitable, regardless of whether tariff negotiations between the United States and other countries produce results.

“I think the Bank of Japan will likely hike rates no earlier than the start of next year. A rate hike will be more likely if wage increases are expected to remain elevated in the 2026 spring labor negotiations,” he said.

Takeshi Minami, of Norinchukin Research Institute Co., noted that there was a risk of inflation slowing down, and saw the BOJ possibly considering a raise in rates around autumn.
 
 

• Hyundai Motor holds handover ceremony with Iwasaki Group on Yakushima Island, Japan, for Hyundai ELEC CITY TOWN electric buses
• Hyundai ELEC CITY TOWN buses are optimized for Yakushima's environment, with Vehicle Dynamics Control and advanced battery management and cooling systems
• The initiative demonstrates Hyundai Motor's strong commitment to its vision of 'Progress for Humanity' and to building a more sustainable future worldwide

Seoul, South Korea and Yakushima, Japan, (ANTARA/PRNewswire)- Hyundai Motor Company today held a handover ceremony to deliver Hyundai ELEC CITY TOWN electric buses to Tanegashima Yakushima Kotsu, a regional transportation and tourism service provider operated by the Iwasaki Group in Kagoshima Prefecture, Japan.

The initiative marks a significant step in transitioning to zero-emission public transport on Yakushima Island, a UNESCO World Heritage Site.

The event was attended by Jaehoon Chang, Vice Chair of Hyundai Motor Group; Toshiyuki Shimegi, CEO of Hyundai Mobility Japan; Yoshitaro Iwasaki, CEO of Iwasaki Group; and Koji Araki, Mayor of Yakushima.

The handover follows the signing of a Memorandum of Understanding (MoU) in July 2024 between the two parties for the purchase of Hyundai ELEC City TOWN buses.

"I am delighted to see Hyundai's ELEC City electric buses running here on Yakushima, contributing towards a cleaner island environment," said Hyundai Motor Group Vice Chair Jaehoon Chang. "Being part of Yakushima's zero-emission island initiative is a significant step towards achieving carbon neutrality on the island by 2050."

Starting from June 2025, five Hyundai ELEC CITY TOWN buses will operate on Yakushima. These medium-sized, low-floor electric buses will be tailored to local conditions. They are equipped with a 145 kWh battery and a high-efficiency motor delivering a power output of up to 160 kW/217 PS.

The buses are equipped with Vehicle Dynamics Control to ensure safe and stable driving on the island's mountainous roads, characterized by steep slopes and sharp curves.

The buses also feature advanced battery management and cooling systems, optimized for Yakushima's hot and humid climate, enhancing charging performance, efficiency and driving range.

On Sunday, April 20th, ahead of the handover ceremony, Hyundai Motor signed a partnership agreement for the use of electric vehicles on Yakushima. The agreement includes utilizing the ELEC CITY TOWN's Vehicle-to-Home capabilities to supply power to evacuation shelters and medical facilities during natural disasters such as typhoons or periods of heavy rainfall.

Yakushima is located at the southwestern end of the Japanese archipelago and is known for its stunning natural scenery, often referred to as the 'Alps of the Ocean'. As a UNESCO World Heritage Site, the island is recognized as a leading eco-tourism destination, making emissions control essential for environmental preservation.

Kagoshima Prefecture has designated Yakushima as a key area in its plan to achieve carbon neutrality by 2050. Yakushima aims to transition its vehicle fleet to primarily EVs as part of its aim to become a zero-emission island.

Hyundai Motor anticipates that the ELEC CITY TOWN buses will contribute to Yakushima's carbon neutrality goals by providing a mobility solution that supports local sustainability efforts and reflects the needs of the community.

This initiative aligns with Hyundai Motor's global vision of 'Progress for Humanity' and its ongoing commitment to building a more sustainable future.


 

When a severe rice shortage sent prices skyrocketing in Japan last year, Tokyo restaurant owner Arata Hirano did what had once seemed unthinkable: he switched to an American variety.  

The price of the Californian Calrose rice he buys has doubled since his first purchase last summer, but even so it's far cheaper than home-grown grains.
"Unless domestic prices fall below Calrose prices, I don't plan to switch back," said Hirano, whose restaurant offers meal sets of fish, rice, soup and sides.

His willingness to embrace foreign rice may presage a seismic change in mindset for Japanese businesses and consumers - one that could allow Tokyo leeway to relax some restrictions if rice becomes a thorny topic in tariff talks with U.S. President Donald Trump, who has called out Japan's high levies on its staple grain.

Wholesale prices for domestic rice have surged about 70% over the past year to hit their highest levels since current records began in 2006. Crops were hit by extreme heat while a tourism boom has added to demand. Worries abound that not much will change this year.

With inflation also raising the cost of living, businesses are now betting that a nation of people known for their discerning palates and pride in their staple grain is open to change.

Supermarket giant Aeon last week began selling an 80-20 American-Japanese blend that's about 10% cheaper than domestic rice after a test sales-run proved a hit. Fast-food chain Matsuya and restaurant operator Colowide began serving pure American rice this year. At supermarket chain Seiyu, Taiwanese rice has been flying off the shelves since last year.

It's a sharp contrast to 1993, when the Thai rice the Japanese government imported during an acute shortage was largely shunned, leaving supermarkets with piles of unsold bags.

Rare shortages aside, for most of the past six decades, nearly all of Japan's so-called staple rice - which is consumed at meals as opposed to rice used for feed or ingredients in other products - has been home-grown. There hasn't been much need for imports while high tariffs, put in place to ensure Japanese self-sufficiency for its most basic food, have protected local farmers from competition.

Japan limits tariff-free "minimum access" imports of staple rice to 100,000 metric tons a year, or around 1% of total consumption. The U.S. accounted for roughly 60% of that amount last fiscal year, trailed by Australia, Thailand and Taiwan. Anything above that is subject to a levy of 341 yen per kilogram.

When Trump announced sweeping tariffs on much of the world this month, he lambasted Japan for what he said was a 700% tariff on rice, a reference to that levy. Japanese policymakers called his remarks on the sensitive topic "regrettable". They also dispute the 700% figure, saying it's based on outdated international rice prices.

It's unclear, however, just how much - if at all - rice will be discussed in bilateral tariff negotiations that began this week. Some analysts think Trump's Republican administration might not be focused on rice as exports to Japan come from California, a Democratic-leaning state. Nor is it clear how much Japan might be willing to yield in opening up its rice market.

In one sign that there might be room for some change, a panel advising the finance ministry on Tuesday proposed expanding imports of staple rice, saying that lifting the 100,000-ton tariff-free cap could help stabilize supply.

That said, Prime Minister Shigeru Ishiba's Liberal Democratic Party is unlikely to risk angering farmers, traditionally a strong support base, ahead of upper house elections in July.

"It's not possible to make big concessions on rice just before the elections," said Junichi Sugawara, senior fellow at Tokyo-based Owls Consulting Group.

 

MORE IMPORTS TO COME

What is clear is that supply remains an issue. 
In the financial year that ended in March, tariff-free imports of staple rice hit Japan's 100,000-ton cap for the first time in seven years. 

The amount of tariffed imports, while still tiny, also jumped, quadrupling in the first 11 months of fiscal 2024 to just under 1,500 tons.

And this year, rice importer Kanematsu is shipping in its first large-scale purchase of American staple rice, 10,000 tons worth. 

"We're receiving many enquiries from the restaurant industry, convenience stores, supermarkets and rice wholesalers," a Kanematsu spokesperson said. 
In the week to April 6, Japanese supermarket rice prices hit an average of 4,214 yen ($29.65) per 5 kg, marking their 14th straight week of increase and more than double the same period a year earlier.

That's despite a rare release of rice from the government's emergency stockpiles that started last month and is set to continue every month through July.

As for the quality and taste of imported rice, Miki Nihei, a customer at Hirano's restaurant, Shokudou Arata, said she had no complaints and was surprised to learn it wasn't Japanese.

"I had no idea," she said. "I have no qualms about eating imported rice. Prices have gone up, so I'm always looking for cheaper options."