The June Trade Statistics Flash Report released by the Ministry of Finance on July 20 showed that the total export volume was 4.8620 trillion yen, a decrease of 26.2% from the same month of the previous year. Due to the impact of the expansion of the new coronavirus epidemic, it continued to decline sharply, with a double-digit decrease for 4 consecutive months. The decline was less than the 28.3% decrease in May.
Japan’s exports to China in June were 1.243 trillion yen, a decrease of only 0.2%. In March when the new crown virus epidemic was severe, it fell to a reduction of 8.7%, and then the decline has shrunk for three consecutive months. Exports of semiconductor manufacturing equipment etc. decreased. On the other hand, exports of non-ferrous metals such as copper increased by 71.8%, and automobiles also increased by 18.8%. This is considered to reflect the restart of China’s economic activities.
Japan’s exports to the United States in June fell by 46.6% to 724.6 billion yen. The decline was smaller than the 50.6% of the previous month, but it still maintained a decline. Automobile exports decreased by 63.3%. Exports to the European Union (EU) were 433.7 billion yen, a decrease of 28.4%, decreasing from 33.8% last month.
With the gradual restart of global economic activities, Japan’s exports may have bottomed out. Miyamae Ko of SMBC Nikko Securities also pointed out that “due to the further expansion of the epidemic and the impact of the Sino-US trade war, the uncertainty is prominent, and overseas demand for equipment investment may continue to be sluggish.” Although he believes that it has temporarily escaped from the worst period, he believes that it will recover. The speed is slow.
Looking at the overall exports by category, the decline in Japanese exports, mainly automobiles, has shrunk from 60% last month to 40%. On the other hand, general machinery, which has many categories related to equipment investment, has decreased by 24.5%. It deteriorated last month. Electrical equipment also decreased by 18.5%, which was an increase from the previous month.
Japan’s overall imports were 5.1308 trillion yen, a decrease of 14.4%. The impact of crude oil imports from the United Arab Emirates (UAE) etc. decreased by 71.8%, which was prominent. Due to the sluggish domestic demand in Japan, auto imports from Germany fell by nearly 70%. The trade balance (overall exports minus imports) has a deficit of 268.8 billion yen, which has shrunk for two consecutive months.
Japan’s total exports from January to June were 32.3642 trillion yen, a decrease of 15.4% from the same period last year. With exports to the United States as the center, auto exports fell by 30.9%, and auto parts exports fell by 29.0%. Due to the continued impact of the Sino-US trade war and the superimposition of the new crown virus epidemic, the rate of decline has expanded. After the Lehman Crisis, it was the biggest decline in about 10 years since July to December 2009.
Japan’s total imports from January to June were 34.6037 trillion yen, a decrease of 11.6%. Due to the stagnant domestic economic activity in Japan and the decline in crude oil prices, crude oil imports from Saudi Arabia and others fell by 33.4%. Liquefied natural gas (LNG) decreased by 17.0%, centered on imports from Australia. The trade balance deficit was 2.2395 trillion yen. The deficit hit a six-year high.