Sogo Shosa

• Japanese trading conglomerates
• Itochu, Marubeni, Mitsubishi, Mitsui and Sumitomo
• some of them trace their roots to the 19th century.
• They used to dominate Japan’s exports and imports, helping source raw materials globally and sell Japanese products overseas.
• But gradually they have morphed into a different species by investing both upstream—in mining and agriculture—and downstream in retail.

Even though they are called trading companies, most of their revenue no longer comes from taking a cut of international trade or wholesaling as middlemen. Their investments around the world in a multitude of sectors—from textiles to machinery—generate the bulk of their profits. They have a particularly big footprint in natural resource-related businesses, given that Japan has to import much of its energy, food and minerals.

Mitsui, for example, invested in coal and iron ore in Australia and copper mines in Chile.

Itochu owns banana plantations in the Philippines.

Mitsui and Mitsubishi have liquefied natural gas projects across the world, helping secure supplies for Japan—which was the largest LNG importer in 2022. The two companies still own stakes in Russia’s Sakhalin-2 LNG project, even though they had to write down its value last year.

While the groups are largely unknown to the general public outside Japan, inside the country theyíre among the most prestigious firms, hiring the top graduates from the best universities, paying them high salaries and developing them into go-getting international business all-rounders. Theyíre embedded in every part of the Japanese economy ó from carmaking to iron and steel and consumer businesses such as convenience stores. Theyíre also comfortable working outside Japan on everything from energy projects in Africa to fashion businesses in Milan.