(1) PURPOSE OF THE LAW
Since rice , wheat and barley, which are main foodstuffs in Japan, serve as staple foods and also occupy an important position in Japanese agriculture, this law provides for comprehensive measures to ensure ordered rice distribution from producers to consumers, as well as measures for the purchase, import and sale of staple foods by the government. The law aims to stabilize the supply-demand and prices of staple foods, thereby contributing to the stability of people's lives and the national economy.

(2) OUTLINE OF THE LAW AND SYSTEM
1) Basic guideline to ensure the stabilization of supply-demand and price of rice
To ensure the stabilization of supply-demand and prices of rice, the government makes forecasts on the supply of and demand for rice. Based on these forecasts, the government will promote smooth production adjustments for rice, the efficient management of stockpiles from a long- and medium-term point of view..

2) Promotion of smooth implementation of rice production adjustment
The law provides that when implementing measures for rice production adjustment promotion, endeavors due must be paid to support voluntary efforts of the producers, to work for organic coordination with other relevant measures including those for promotion of prodction of crops other than rice on paddy fields, and to adapt the measures to local characteristics (Article 2.2).

3) Measures to ensure appropriate and smooth distribution
Production/shipping and other organizations must produce a rice production adjustment guideline, which includes the target for production quantity of rice, to be approved by Minister of Agriculture, Forestry and Fishery (Article 5.1). Local administrative bodies assist, advise, and cooperate as necessary upon its creation and its operation (Articles 6 and 7).
In addition, interest-free loans will be provided for the purpose of handling backlog surplus stock by the producers participating in production adjustment (Article 9.1). Company Designation System for interest-free loans, etc. is also instituted (Articles 8 to 17).

4) Formation of price of rice
Designated Rice Price Formation Centers (former the Voluntarily Marketed Rice Price Formation Center) conducts sales transaction necessary for the formation of prices, that will serve as an index for the trading of rice, as well as the relevant activities (Article 19).

5) Wheat and barley
i. The Government must purchase domestically produced wheat and barley without limitation upon receipt of applications from producers etc.
ii. Government purchase prices is determined by the minister, taking into account production costs and supply and demand trends etc, and paying due consideration to improvements in productivity and quality of domestic wheat and barley cultivation in order to ensure the continuous production of wheat and barley (Article 41).
iii. The government selling price is set in order to stabilize household accounts of consumers taking into account household expenditure, rice price, etc (Article 43).

6) Border measures
When any entity other than the government imports rice, wheat and barley, etc., the entity must pay to the government the product of imported quantity multiplied by the amount prescribed and notified by the Minister of Agriculture, Forestry and Fishery in accordance with international commitments (Article 34).

(3) CABINET ORDER AND MINISTERIAL ORDINANCES
Enforcement Regulations of the Law for Stabilization of Supply Demand and Price of Staple Food
Enforcement Order of the Law for Stabilization of Supply Demand and Price of Staple Food

(4) HIGHLIGHTS OF THE RECENT AMENDMENT
Since April, 2004, the new amended Law has fundamentally reorganized the former system. Major amendments are as follows:
Whereas the government was previously responsible for setting the "basic plan," the law now provides for the government to establish the "basic guideline," at the same time abolishing the mandatory production adjustment and replacing it with production adjustment guideline established by production/shipping organizations, which are to be approved by the government. The distribution system has also been revised.

(5) REFERENCE INFORMATION
(Liaison Office for Further Information)
General Food Policy Bureau, Ministry of Agriculture, Forestry and Fishery
Tel: 03-3502-8111 (Representative) http://www.syokuryo.maff.go.jp