Sticky Situation: Trump Threatens Tariffs on Japanese Rice

 

Washington, D.C. (July 3, 2024) – Former President Donald Trump has escalated trade tensions with Japan, threatening higher tariffs on its exports to the United States over claims the country refuses to buy American rice. The assertion, made on Trump's Truth Social platform, contradicts official trade data showing significant Japanese imports of US rice.

In a Truth Social post, Trump declared: "They won’t take our RICE, and yet they have a massive rice shortage. In other words, we’ll just be sending them a letter, and we love having them as a Trading Partner for many years to come." He singled out Japan as a country set to receive a formal tariff warning letter.

Contradicted by Data:
Trump's claim that Japan "won’t take" US rice is demonstrably false, according to US Census Bureau trade figures:

Japan purchased $298 million worth of American rice in 2023.

Between January and April 2024, imports totaled $114 million.

The rice threat appears linked to long-standing US concerns about market access, not an outright refusal to buy. A 2021 report by the Office of the U.S. Trade Representative under President Biden criticized Japan’s "highly regulated and nontransparent system of importation and distribution for rice," which it said limited meaningful access for US exporters. A source familiar with Trump's thinking confirmed this is the underlying issue he referenced.

Broader Tariff Strategy & Auto Threat:
The rice threat fits into Trump's broader plan to send "reciprocal" tariff letters to trading partners. He recently paused a proposed April tariff hike but warned the 90-day pause expires on July 9. The future of tariffs for dozens of countries remains uncertain.

Pre-pause, Japanese exports faced a minimum 24% tariff; currently, it's the standard 10%.

In a Fox News interview, Trump explicitly threatened Japan with a 25% tariff on cars: "Dear Mr. Japan, here’s the story: You’re going to pay a 25% tariff on your cars."

Japan's Response:
Japanese officials offered cautious, diplomatic replies:

Chief Cabinet Secretary Yoshimasa Hayashi confirmed trade talks are ongoing and the government is aware of Trump's claim but declined direct comment. He stated: "While we refrain from disclosing the specifics... Japan will continue to vigorously pursue sincere and honest discussions with the aim of achieving an agreement that will benefit both Japan and the US."

The response avoids confrontation while affirming Japan's commitment to negotiations.

White House National Economic Council Director Kevin Hassett emphasized negotiations are still active despite Trump's post: "Nothing is over... I know what he just posted, but there’ll still be discussions right up till the end. Even if we get a framework, then there’s still gonna be things to finalize." This suggests ongoing efforts behind the scenes ahead of the July 9 deadline.

Trump's threat, based on a disputed claim, highlights his aggressive, often factually loose approach to trade policy. It targets a key US ally and significant trading partner, raising fears of renewed economic friction. The focus on rice, while symbolic of market access complaints, pales next to the potentially massive impact of threatened auto tariffs. With the July 9 deadline looming, Japan and other trading partners await clarity on whether Trump will follow through on his "reciprocal" tariff threats, potentially disrupting global trade flows. The situation underscores the high stakes for international commerce should Trump return to office.

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