Rejecting "agriculture for cars", Japan considering increasing purchase of American corn to balance trade negotiations.

Japanese Prime Minister Shozo Ishiba stated on Monday that increasing imports of corn from the United States would be one option in the trade negotiations with the US. However, he emphasized that Japan would never sacrifice its domestic agriculture for a reduction in car tariffs. Japan has held two rounds of trade talks with the United States, but progress has been minimal in seeking exemptions from US tariffs, including the 25% tariff on Japanese cars, which has dealt a heavy blow to Japan's automotive industry. During the first round of talks last month, US negotiators pointed out that Japan has set up market barriers in the automotive and rice sectors. For Japan, agreeing to increase corn imports is less controversial compared to increasing rice imports. The ruling party led by Shozo Ishiba, the Liberal Democratic Party, heavily relies on the support of rice farmers. Ishiba reiterated in parliament that Japan would not sacrifice domestic agriculture for the US to make concessions on car tariffs. He stated, "However, Japan can use corn for ethanol production, not for food consumption. Using corn for biomass energy is in Japan's national interest." He also added that Japan's soil conditions are not well-suited for growing corn. He said, "We hope to explore in depth the consumption and energy uses of corn," but did not elaborate on specific plans. In 2024, the US exported $2.8 billion worth of corn to Japan to make up for an 80% drop in exports to China. At the same parliamentary meeting, Japan's chief trade negotiator, Ryosei Akazawa, stated that he firmly demands the US to lift all tariffs imposed by the Trump administration, and his position will not waver. These remarks come as Japan plans to schedule a third round of bilateral ministerial-level trade talks later this month. The agreement between China and the US to reduce "equal" tariffs may impact the outcome of these talks. According to two sources, Japan may also propose to cooperate with the US in the field of shipbuilding. Japanese policymakers and ruling party members have stated that reaching an agreement with the US is meaningless unless the US lifts the 25% import tariff on cars, given the significant impact of the automotive industry on Japan's export-oriented economy. This impact has been evident in Japan's automotive industry. Mazda announced a 45.1% drop in net profit for the fiscal year ending in March this year, and has not yet disclosed profit expectations for the fiscal year ending in March 2026. On April 2, US President Donald Trump imposed a 10% tariff on all countries except Canada, Mexico, and China, and raised tariff rates for many major trading partners, including Japan. If Japan fails to reach an agreement with the US, it will face a 24% tariff starting in July.