U.S. President Donald Trump today said he had agreed with Japanese Prime Minister Shinzo Abe to start talks on a bilateral free trade agreement.

"We’ve agreed today to start trade negotiations between the United States and Japan," Trump said at a summit with Abe in New York on the sidelines of the U.N. General Assembly.

“This was something that for various reasons over the years Japan was unwilling to do and now they are willing to do. So we’re very happy about that, and I’m sure that we will come to a satisfactory conclusion, and if we don’t, ohhhhhh," he was quoted as saying by Reuters.

Trump has made clear he is unhappy with Japan’s US$69 billion trade surplus with the U.S. - nearly two-thirds of it from auto exports - and wants a two-way agreement to address it.

Reuters also reported that Tokyo is worried that as part of any bilateral deal Washington might put pressure to open up its politically sensitive farm market.

In a statement, U.S. Secretary of Agriculture Sonny Perdue today said: “Achieving high-standard trade agreements is a top priority for American agriculture, and the announcement of the beginning of negotiations for a U.S.-Japan trade agreement is an important step in that process.

"This is welcome news, since we know that export income is critical to the financial health of agriculture and is a key contributor to rural prosperity. Japan is an important customer for our agricultural products and we look forward to the great potential this breakthrough represents.

"Today’s announcement is further proof that President Trump’s approach to trade – standing strong for American interests and bringing other countries to the table – will benefit our entire economy, including the agricultural sector."

According to USDA Foreign Agricultural Service data, in 2017 the U.S. shipped around US$300 million of fruit and a similar value of nuts to Japan, holding market shares of 15% and 52%, respectively.