Shares of Japan’s five largest trading houses surged by up to 9% on Tuesday after Warren Buffett indicated that Berkshire Hathaway plans to increase its stakes in these core players of Japanese industry.
Following a long weekend due to a public holiday, Mitsubishi Corporation led the rally with a nearly 9% jump, while Mitsui rose over 4%, Marubeni climbed 7.5%, Sumitomo gained almost 7%, and Itochu advanced 6.7%.
Berkshire Hathaway initially disclosed in 2020 that it had invested 5% in each of the five trading houses, spending more than $6 billion. Since then, it has increased those stakes, with the market value of its holdings now reaching $23.5 billion, compared to the original $13.8 billion acquisition cost.
In his annual letter to shareholders, Buffett revealed that Berkshire had agreed with the five trading houses to relax a previous cap limiting its investments to 10%. “Over time, you will likely see Berkshire’s ownership of all five increase somewhat,” Buffett wrote.
The five trading houses have evolved beyond their origins in commodities trading, holding diversified portfolios that span convenience stores, salmon farms, infrastructure, and technology start-ups. With up to 1,300 companies in their portfolios, these firms are often compared to private equity firms due to their long-term investment approach.
Buffett’s renewed commitment to Japanese investments reflects the impact of corporate governance reforms and rising inflation, which have attracted global investors to Japan. He highlighted the $812 million in dividends expected from Berkshire’s holdings in 2025, emphasizing Japanese companies’ growing focus on shareholder returns.
Marubeni hailed Berkshire’s investment as a testament to the sector’s global reputation, while Mitsubishi confirmed ongoing discussions with Berkshire about potential collaborations, including joint investments.
This strategic alignment also aligns with recent pledges between Japanese Prime Minister Shigeru Ishiba and U.S. President Donald Trump to increase Japanese investments in the U.S. and boost U.S. gas purchases. Analysts predict that trading houses, with their adaptable business models and global reach, will play a key role in this evolving economic partnership, benefiting from increased foreign direct investment into Japan and shifting geopolitical dynamics.
