The US–Japan trade deal, announced by President Donald Trump on July 22, reduces the proposed tariff on Japanese imports from 25% to 15% and opens Japan’s markets wider to the US agricultural goods.

The announcement via Truth Social marks a sharp reversal from Washington’s earlier stance, which included a 25% blanket tariff on Japanese goods starting Aug. 1. This plan now appears shelved in favor of a negotiated approach that could reshape US commodity export flows, particularly for rice, ethanol, beef, pork, and related feedstock markets.

Commodities at the Core
Japan, already a top-five market for US agriculture, is expected to increase purchases of corn, wheat, and rice.

According to USDA Foreign Agricultural Service data, Japan imported about 15.4 million mt of corn, mostly from the US, maintaining its status as one of the largest buyers of US corn globally.

Japan ranks as the second-largest market for US corn exports, with annual trade often exceeding $2 billion.

It also remains a key wheat buyer, with 2024–25 imports around 5.5 million mt, half typically sourced from the US, along with Canadian and Australian supply.

While rice imports from the US were strong in 2024, a domestic shortage in 2025 has driven Japanese table rice prices up 70%–140% compared to historical averages, prompting emergency releases of government-held stocks.

Japan imports about 682,000–688,000 mt of rice annually, primarily through government-managed tariff-rate quotas under its WTO commitments, according to USDA Foreign Agricultural Service (FAS) data.

To address the price spikes, the Japanese government released about 600,000 mt from emergency grain reserves. While private-sector rice imports are usually limited, they have increased slightly in 2025 despite high levies.

Market participants expect that improved access under the new trade deal could boost US rice exports by 5%–10% in 2025, with similar gains likely for corn and wheat, mirroring the increase seen after the 2019 US–Japan trade pact.

Protein punch
Japan remains a cornerstone market for US beef and pork exports, accounting for billions of dollars in trade annually.

According to USDA data, beef exports to Japan in 2023 totaled about $2.3 billion, while pork reached $1.5 billion, making Japan the largest market for US beef and the second-largest for pork. Final 2024 figures are expected to be similar, according to market sources.

The 2019 US–Japan Trade Agreement significantly improved market access for US meat producers by cutting Japan’s tariff on US beef from 38.5% to 26.6% and phasing it down further over time, aligning US access with that of competitors like Australia under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

Tariffs on US pork were also reduced or eliminated, particularly for lower-value cuts and processed pork, narrowing the competitive gap.

The 2025 package is expected to cement gains, streamline sanitary rules, and stabilize quotas, helping US beef exports approach or exceed $2.4–$2.5 billion and pork exports reach $1.55–$1.6 billion in 2025, assuming steady demand and no major disruptions due to Japan’s shrinking herds and high feed costs.

“Beef, pork, and poultry producers were staring down a 2019-like scenario,” said a senior executive with a Midwestern meat cooperative, referring to the US–China trade conflict that drove pork prices down nearly 15% at the time. “Now we have stability and perhaps upside if Japan increases quota ceilings.”

Australia, which gained market share during earlier US tariff disadvantages, may face renewed competitive pressure in Japan as US meat regains price competitiveness under the updated agreement.

Biofuels boom
According to USDA and US Renewable Fuels Association data, Japan imported about 200 million gallons (761 million liters) of US corn ethanol worth an estimated $200–$300 million, primarily via ETBE blends, in 2023.

The new market-opening provisions could boost exports by 10%–15%, reaching $220–$345 million (220–230 million gallons) in 2025. However, there is a risk that Japan could shift sourcing to Brazil following tariff changes earlier this year.

Brazil remains a strong competitor, especially with Japan aiming for 10% ethanol blending by 2030 (up from about 1.8% now). Brazil’s tariff hikes on US ethanol earlier this year could tilt the balance back toward Brazilian supply.

While the deal resets the immediate bilateral dynamic, questions remain over implementation timelines and whether sector-specific duties — such as on ethanol or premium meat — will be included in the 15% umbrella or negotiated separately.

If the investment tranche includes logistics or bio-refining infrastructure, it could further accelerate US–Japan integration across clean fuels and agri-supply systems. However, without that clarity, stakeholders are watching cautiously.

“There’s potential here for a durable alignment,” said a Singapore-based commodities trade lawyer. “But we need to see the fine print.”
Source: Platts