The History of the Japan Cotton Company: From Osaka to Dallas

The Japan Cotton Company originated as the American headquarters of Nippon Menka Kabushiki Kaisha (the Japan Cotton Trading Company), founded in Osaka, Japan, in November 1892. The Japanese company handled imports of cotton to Japan and subsequently expanded into the exportation of Japanese textiles and silk. In 1910 representatives of the company, Atsushi Yamada and Toyotaro Yasui, established its American headquarters in Fort Worth. In 1916 the American branch was incorporated as the Japan Cotton Trading Company of Texas. In 1926 the company relocated to Dallas and shortened its name to the Japan Cotton Company.

Trading companies such as Nippon Menka were established during the Meiji Era in response to foreign control over external trade following the end of Japan’s policy of isolation. Such companies established themselves as intermediaries between Japanese and foreign companies. They built an international trading infrastructure through which trade could be conducted along familiar lines, in the Japanese language, between similarly structured companies. In 1896 Nippon Menka became the first Japanese company to import cotton from the United States, and company representatives became the first Japanese members of the New York Cotton Exchange.

The opening of the Fort Worth office came in anticipation of the opening of the Panama Canal in 1914. The canal decreased the cost of shipping cotton from the South to Japan and made American cotton more competitive with Indian cotton—India was the largest supplier of cotton to Japan. The company’s American branch primarily purchased cotton in Texas and Oklahoma. Yamada served as the American manager until 1912, when he returned to the main offices in Japan. Matazo Kita assumed charge before passing managerial responsibilities to Yasui in 1913. According to Yasui’s estimates, in 1912 Japan had imported 350,000 bales of cotton from America, with 300,000 bales (about 85 percent) coming from Texas. Of these, the American branch was responsible for 160,000 bales of Texas cotton, representing a majority of Texas cotton exports to Japan and nearly half of all American exports. By 1913 there were two other Japanese cotton trading firms with offices in Texas, the Southern Products Company (later Southern Cotton Company), owned by Mitsui & Company, and the Gosho Company. Nippon Menka, Mitsui, and Gosho were the major Japanese trading companies engaged in the cotton trade.

In March 1916 the Japan Cotton Trading Company of Texas was chartered with a capital stock of $100,000. Its incorporators were Yamada, Mankichi Yamakawa, Thomas D. Ross, and Zeno C. Ross. The charter was amended to increase the capital stock to $500,000 in 1918 and again to double the capital stock to $1,000,000 in 1921. In 1918 the company became a member of the United States Chamber of Commerce. The company had offices located throughout Texas (including at Abilene, Austin, Brownwood, Greenville, Lubbock, San Antonio, Waco, and Wichita Falls) as well as offices in Oklahoma and other cotton growing states. In 1920 the company built a warehouse and compress in Houston. That year Yasui paid $5,100, a record price, for membership in the Houston Cotton Exchange. In 1921, when the Fort Worth Grain and Cotton Exchange moved into the Neil P. Anderson Building, the Japan Cotton Trading Company occupied the entirety of the eighth floor, and the Gosho Company all of the sixth. That year the Fort Worth Star-Telegram credited the two Japanese firms with giving “considerable impetus” to the growth of the cotton industry in the city.

In 1926 the Japan Cotton Trading Company moved into the new Dallas Cotton Exchange Building in Dallas, where it occupied all of the fifteenth floor. With this move the company became the Japan Cotton Company. That year Vice President Seizo Kimura reported that the company bought more than 400,000 bales for export annually, with around two-thirds of purchases being shipped to Japan and the rest to European markets. Susumu Tsukaguchi was president of the company for much of its time in Dallas. In 1933 Abner Mayhew, a longtime agent of the company, was elected president of the Dallas Cotton Exchange.

Company representatives promoted increased trade and good relations between Japan and the United States. They hosted Japanese observers and speakers and commented on international news stories involving Japan. During World War I, the company donated generously to the American Red Cross and to Tarrant County Liberty Loan drives. (In 1919, $15,000 in Liberty bonds were stolen by a former employee, although they were quickly recovered.) In 1934 the company helped fund a scholarship allowing Agricultural and Mechanical College of Texas students to tour textile centers in Japan. In 1937 the Houston Post wrote of the Japan Cotton Company and the Gosho Company that “their activities, as well as the personnel of their executive staffs go far toward cementing the growing friendly relations between Texas and the Japanese empire.” To avoid controversy, company executives fastidiously avoided getting involved in American political matters. A notable exception to this policy came in 1921, after state senator Richard M. Dudley introduced a bill to ban Japanese immigrants from owning or leasing land in Texas, following the passage of a similar law in California. In early 1921 Yasui, Kanetaro Fujita of the Gosho Company, representatives from the Southern Products Company and other Japanese businesses, and Y. Kishi of the Kishi Colony met in Fort Worth to discuss plans for fighting the bill. Prior to the bill’s passage, Japanese interests successfully lobbied for the addition of an amendment which exempted all Japanese already living in Texas.

In September 1940 Japan invaded French Indochina and signed the Tripartite Pact with Germany and Italy. The following year President Franklin D. Rosevelt froze all Japanese assets in America. The Japan Cotton Company received a license from the United States Treasury Department to continue its domestic business, and acting manager Masao Yamamoto sought a license to continue exports to Japan under government supervision. The company’s funds were frozen again after the attack on Pearl Harbor. In the aftermath of the attack, Yamamoto, who had lived in Dallas for fifteen years, was arrested and held for questioning along with several other Japanese nationals in Dallas. In 1942 Yamamoto and his family (including a son born in America) were among those deported to Japan in exchange for the return of American civilians held in Japan. Back in Japan, Yamamoto complained to the Japanese press about his treatment in the Dallas jail, prompting police detective Will Fritz, “one of Dallas’ most enthusiastic Jap-haters,” to baselessly denounce him as “one of the most dangerous of enemy agents.” All shares in the company owned by Japanese nationals, a controlling stake in the company, were seized by the Alien Property Custodian.

During World War II, Nippon Menka was tapped by the Japanese government to handle the management of factories that produced flour, matches, and starch. In 1943, to reflect its broadened operations, the company was renamed the Nichimen Enterprise (later the Nichimen Corporation). With the dissolution of the zaibatsu (large, vertically-integrated conglomerates) during the American occupation of Japan, Nichimen quickly became one of the country’s largest general trading companies. After 1955 textiles no longer formed the core of the company’s export operations. By 1958 the company had diversified considerably and captured 6 percent of Japan’s foreign trade. After the war Nichimen reestablished the Dallas firm, chartered as the Japan Cotton Company in 1954. Hiroo Nakahara was the longtime president of the second Dallas firm. In 2004 Nichimen merged with the Nissho Iwai Corporation to form the Sojitz Corporation.