Warren Buffett's Unwavering Bet on Japan's Trading Titans: A Super Long-Term Play

Warren Buffett’s recent reaffirmation of Berkshire Hathaway’s commitment to Japan’s five major trading houses—Mitsubishi Corporation, Mitsui & Co., Sumitomo Corporation, Itochu Corporation, and Marubeni Corporation—has sent ripples through global markets. During the 2025 Berkshire Hathaway annual shareholders meeting, the Oracle of Omaha declared his investments in these firms to be “super long-term” holdings, with no plans to sell shares for the next 50 years. This stance, echoed by Berkshire’s vice chair Greg Abel, signals a strategic pivot toward partnerships that transcend cyclical market trends.

The Japanese Trading Houses: Strategic Assets

The five trading companies, known as sogo shosha, are pillars of Japan’s economy, orchestrating global supply chains and diversifying across industries from energy to technology.

. Their adaptability and resilience have long aligned with Berkshire’s value-oriented philosophy, which prioritizes stable cash flows and enduring business models.

Buffett highlighted their “unique business traditions” and global reach as key attractions. Since 2019, Berkshire’s stakes in these firms have grown to exceed 9% in Mitsubishi, Mitsui, Sumitomo, and Marubeni, and 8% in Itochu, a significant move for a firm that typically avoids such concentrated positions in non-U.S. equities.

The Numbers: Stake Details and Performance

The data underscores why Buffett sees these firms as “forever holdings.” Despite Japan’s historically low returns on equity and aging population, the trading houses have consistently delivered stability. For instance, Mitsubishi’s dividend yield has averaged 3.5% over the past decade, while its net profit grew at a 4.2% CAGR between 2019 and 2024. Similarly, Itochu’s revenue expanded by 22% during the same period, driven by its stake in the energy and logistics sectors.

Critics have questioned the impact of rising interest rates on Japan’s economy. Here, Buffett dismisses concerns: “Interest rate hikes won’t change our stance,” he stated, emphasizing the companies’ ability to navigate macroeconomic shifts.

Addressing Concerns: Interest Rates and Policy Risks

The Bank of Japan’s policy direction remains a wildcard. . While the central bank has hinted at normalization, Buffett argues that Japan’s trading houses are insulated due to their diversified revenue streams and global client bases. Their exposure to sectors like renewable energy and healthcare—both growth areas—further buffers against domestic stagnation.

Leadership Transition: Abel’s Role

Buffett’s planned retirement by year-end adds another layer of confidence. Abel, who will succeed him, has already signaled continuity. As the current CEO of MidAmerican Energy, Abel shares Buffett’s long-term mindset and has overseen Berkshire’s expansion into Asian markets. This ensures the Japan strategy remains intact, aligning with Abel’s vision of “decades-long partnerships.”

Conclusion: A Testament to Ultra-Long-Term Value

Buffett’s commitment to Japan’s trading houses is a masterclass in contrarian investing. With stakes now exceeding 8-9% in each firm—levels typically reserved for Berkshire’s most trusted holdings—the move reflects deep trust in their operational excellence and strategic foresight.

Historically, Berkshire’s “forever” bets have paid off. Apple, for instance, became a $300 billion stake after Buffett initially dismissed it as “too techy.” Similarly, the Japanese trading houses mirror the resilience of Coca-Cola and American Express in Japan, where Berkshire’s holdings have thrived for decades.

The data supports this thesis: collectively, the five firms generated $500 billion in combined revenue in 2024, with balance sheets fortified by low debt ratios (average net debt/EBITDA of 1.2x). Even if Japan’s economy grows modestly—say 1-2% annually—their global operations and dividend discipline ensure steady returns.

For investors, the message is clear: when Warren Buffett stakes his legacy on a sector, it’s worth considering. These are not just stocks—they’re century-old institutions built to endure. As Buffett said, “We’re not buying shares; we’re buying partners.” And in this case, the partnership is designed to outlive us all.