Editor’s Note
This article outlines a significant industrial development, reporting that a U.S.-based synthetic diamond production plan is poised to be the inaugural project under a major $550 billion investment framework linked to a Japan-U.S. tariff agreement.
On January 27, 2026, it was reported that a plan to produce “synthetic diamonds” within the United States has emerged as a strong candidate to be the first project under the $550 billion investment and financing commitment to the US, based on the Japan-US tariff agreement.
Fundamentally, in July 2025, the Japanese and US governments agreed to reduce the so-called Trump tariffs on Japanese exports to the US from 25% (27.5% for automobiles) to 15%, while Japan would implement $550 billion (approximately ¥85 trillion) in investment into the US. Looking at the fact sheet compiled by Japan and the US regarding the specifics of this investment, targets included “critical energy infrastructure” such as large-scale power infrastructure construction in collaboration with SoftBank Group (9984), “AI infrastructure,” and “critical minerals.”
Now, as part of this first batch of projects, “synthetic diamond production” is reportedly a strong candidate alongside several other projects, including power generation-related ventures. According to reports, an announcement could be made even before Prime Minister Takachi’s potential visit to the US, which is being considered for late March at the earliest.
While many associate diamonds with jewelry, synthetic diamonds are an essential material for ultra-precision semiconductor polishing, quantum device manufacturing, military radar components, and are thus a critical material for economic security. Reports indicate China currently accounts for over 60% of global production, and like rare earths, they are subject to export controls.
The US also relies heavily on imports from China for synthetic diamonds used in semiconductor manufacturing, making stable procurement a key challenge. As a solution, the US government aims to collaborate with Japanese companies to promote domestic production of synthetic diamonds and build an independent supply chain free from Chinese involvement.
A recent focus within the applications of this critical material, synthetic diamond, is the “diamond semiconductor.” This is a semiconductor that uses synthetic diamond as a substrate, characterized by its ability to operate under high temperatures and high voltage compared to current mainstream silicon semiconductors. Furthermore, it does not lose its semiconductor properties even in high-radiation environments, generates less heat during use, and has excellent heat dissipation, leading to expectations for its practical application as the “ultimate semiconductor.”
For example, Okuma Diamond Devices, founded in 2022, is developing diamond semiconductor devices for radiation sensors. They are planned for use in decommissioning work at the Fukushima Daiichi Nuclear Power Plant, and the company aims to start operation of the world’s first commercial mass-production factory for diamond semiconductors in Okuma Town, Fukushima Prefecture, in 2026.
Additionally, Diamond Semiconductor, a startup from Saga University established in February 2025, is accelerating efforts toward the social implementation of diamond semiconductors for communication purposes, in collaboration with Saga University and the Japan Aerospace Exploration Agency (JAXA).
If “synthetic diamond production” is confirmed as one of the “first projects” under the US investment, market interest in diamond semiconductors is expected to rise. Therefore, this article focuses on “diamond semiconductor” related stocks.
While core stocks often mentioned include EDP (7794), which manufactures and sells synthetic diamond single crystals; J-Tech Corporation (3446), an Osaka University venture handling optical equipment for research facilities; Asahi Diamond Industrial (6140), a diamond tool manufacturer; Technisco (2962), handling diamond composite materials; and Sumiseki Holdings (1514), whose subsidiary DIA MATERIAL manufactures synthetic diamonds, this article intentionally introduces other “hidden related stocks.”
In March 2025, Sumitomo Electric Industries (5802) announced the successful fabrication of a gallium nitride transistor “GaN-HEMT” on a 2-inch polycrystalline diamond substrate in a joint research project with Osaka Metropolitan University under the Japan Science and Technology Agency (JST). This is seen as an important step toward achieving higher capacity and lower power consumption for core devices in the communications field.
In April 2025, JVCKenwood (6632) began joint research with Saga University aimed at the social implementation of diamond semiconductors. Saga University conducts world-leading research on diamond semiconductors, and the joint research will proceed with an eye on applications in wireless communication equipment, an area of strength for JVCKenwood.
Honda Motor Co., Ltd. (7267) has set a goal of significantly reducing overall social power consumption through integrated research on diamond power semiconductors, from materials to implementation technology. Currently, through joint research with the National Institute of Advanced Industrial Science and Technology (AIST), it is advancing the development of diamond MOSFET (Metal-Oxide-Semiconductor Field-Effect Transistor) devices.
JEOL Ltd. (6951) delivered an electron beam lithography system “JBX-8100FS” and a scanning electron microscope “JSM-IT800” to Saga University, which is advancing the practical application of diamond semiconductors. These are reportedly used for drawing integrated circuits on diamond semiconductors and inspecting the interior of semiconductor devices.
Maipox (5381) combines its core technologies of “coating,” “cutting,” and “polishing” to provide products and contract processing in the precision polishing field. Diamond wafers used in diamond semiconductors are considered difficult-to-process materials, but the company holds strength in their polishing and processing technology.
On February 2, B-Map (4316) announced it would jointly begin development and sales of high-performance observation modules utilizing synthetic diamonds in the US market with Spicy Company, a domestic venture with strengths in synthetic diamond production and application technology. B-Map will be responsible for the design and development of synthetic diamond observation modules for the US market, optimization of product specifications based on local needs, and sales activities.