WASHINGTON (Kyodo) — Japan will purchase $8 billion in U.S. farm and food goods, such as corn, soybeans, fertilizer and bioethanol, under a new trade deal, the White House said Wednesday.
A day after the United States and Japan reached the agreement, the White House provided more details of its terms, stating that Washington’s key ally will also increase purchases of U.S.-made commercial aircraft, including 100 Boeing planes, and defense equipment worth “additional billions of dollars annually.”
After rounds of negotiations, the deal, which sharply lowered U.S. tariffs on imported Japanese cars and other goods to 15 percent, was sealed Tuesday before the expiry of the Trump administration’s pause on hefty country-specific levies on Aug. 1.
For the administration, the biggest gain was Japan’s commitment to investing $550 billion in the United States, particularly with funds to be directed to sectors deemed strategic, ranging from semiconductors and pharmaceuticals to energy infrastructure and critical minerals.
The White House highlighted that the deal represents what it called the “single largest foreign investment commitment ever secured by any country.” It touted the agreement as a “strategic realignment of the U.S.-Japan economic relationship” that will advance the mutual interests of both countries.
As part of the deal, Japan has also promised to expand the portion of rice imports from the United States under the World Trade Organization’s “minimum access” quota system.
Without providing details, the White House said Japan will immediately increase imports of U.S. rice by 75 percent, accompanied by a “major expansion” of quotas.
Currently, Japan imports about 770,000 tons of tariff-free rice a year under the WTO framework, with the United States the No. 1 exporter, accounting for nearly half of the total, followed by Thailand and Australia.
Of the amount, up to 100,000 tons is imported for direct consumption. Most of the remainder is used for animal feed and processing into other food products. Any rice imported to Japan beyond the special quota is subject to a tariff of 341 yen ($2.3) per kilogram.
In fiscal 2024, the United States shipped roughly 346,000 tons of rice to Japan, compared with 286,000 tons exported by Thailand and 70,000 tons by Australia, under the quota system, according to Japan’s farm ministry.
For Japan, rice, its main staple food, is politically sensitive given that rice farmers have long been a key constituency of the country’s ruling Liberal Democratic Party.
Japanese officials have said the deal does not involve Japan lowering tariffs on farm products and that expanding the portion of American rice under the special quota would have no significant impact on its domestic rice market.
While appearing on Fox News on Wednesday, U.S. Treasury Secretary Scott Bessent was asked how the Trump administration plans to make sure Japan complies with its commitments.
Bessent said it will check the extent of Japan’s compliance every quarter and “if the president is unhappy, then they will boomerang back to the 25 percent tariff rates, both on cars and the rest of their products.”
Throughout the bilateral negotiations, one of Japan’s prime concerns was scrapping or reducing Trump’s additional auto tariff, which he raised by 25 percentage points to 27.5 percent in April.
At an event in Washington, Trump said he cut his so-called reciprocal tariff rate for Japan to 15 percent from 25 percent because Tokyo had agreed “for the first time ever to open up its country to trade so that all of our American businesses and business geniuses…can go out and do business openly and freely.”
While describing Japanese negotiators as tough, he said Japan is a “wonderful” country.
White House spokeswoman Karoline Leavitt said the centerpiece of the deal with Japan is its commitment to $550 billion in investment to revitalize American industries.
She told a press briefing that Japan’s initial commitment was $400 billion in investment, but Trump negotiated and realized an increase of $150 billion.
US says Japan to buy $8 billion in American farm, food products
