For DPRK economy watchers, the last year has been relatively quiet regarding the agricultural sector. Aside from a landmark conference for sub work team leaders in February, and the annual weather crisis (low rainfall in April and midsummer), there was little news. Yet it appears that policy modifications announced in previous years, and received with skepticism in many quarters, have gradually been implemented nationwide. To the question whether they are actually making any difference for farm production, one can answer with a guarded ‘yes.’ But to date, they do not constitute a Chinese- or Vietnamese-style economic reform. We should continue to observe these developments cautiously since the history of DPRK farm policy has been characterized by grand pronouncements followed by grudging implementation and eventual rescission when it seemed like central control was being weakened.
Reviewing Past Efforts
The recent trajectory of policies intended to boost farm production begins with the July 2002 price and wage adjustments, the so-called 7.1 measures, which, in an effort to boost farmer and worker motivation, effectively devalued the North Korean won (KPW) by setting salaries and prices at levels that momentarily reflected its free-market value. But lacking additional supplies or fuel beyond the meager government allotments, farms were unable or unwilling to significantly increase production. The gap between official and market prices and exchange rates immediately reestablished itself, and continued to grow. Late in the 2004 growing season, it was announced that sub work teams (SWTs) should be reduced in size, that farm production quotas would be disaggregated to the SWT level, and that any surplus production above the quota could be sold in the farmers’ markets. But this change was announced too late in the season to effect farmers’ management decisions that year, and in any case, was not widely implemented and rolled back the following year.
Over the next several years, markets continued to expand despite government efforts to limit participation. In November 2009, an ill-conceived currency devaluation created momentary chaos in the markets and substantial popular disaffection. Policy at the farm level remained more or less constant until late June 2012 when the “6.28 measures” were promulgated. Initially introduced on a trial basis in a few selected counties in Ryanggang Province, they have apparently now, for the most part, been implemented nationwide.
Key provisions of the 6.28 measures were that SWTs should be kept small (10-12 persons), that they would be responsible for their own production decisions, and that they would keep 30 percent of their production quota plus any excess over the quota (meaning that 70 percent of the quota would be delivered to the state). Whether the retained grain surplus could be sold in the open market, or must be sold to the state was not entirely clear. The timing of the 6.28 measures and their gradual roll-out made it impractical for farms to implement the changes until the following year (2013), and various sources indicate that not all farms or all counties put the policies into effect. In some cases they were rolled back in the face of opposition from vested (non-farm) interests such as the military and rural bureaucrats.
In February 2014, a convention of over 8,000 SWT leaders was held in Pyongyang, and received a detailed letter from Kim Jong Un calling for specific technical and organizational innovations in farming. This was probably the most publicized statement of DPRK farm policy and recommended practice in decades, and significant in its reaffirmation of both the 6.28 principles, and the distribution of the harvest according to the work and productivity of the SWT members. It now seems clear that the 6.28 measures were widely if perhaps not universally implemented during 2014. Other provisions of these measures relate to manufacturing enterprises, and allow private investment and market-based pricing of goods, among other things.
A further tweaking of these efforts occurred in mid-2014, with a new set of pronouncements (the “5.30 measures”) issued by the Cabinet and the Central Committee of the Korean Workers’ Party. These measures further shrunk the SWT to “family size,” reiterated that the teams could expect to cultivate the same field(s) for many years (this was hinted at in the letter to the SWT leaders’ convention), and changed the farmers’ share of production from 30 to 60 percent of their disaggregated quota. These changes are still in process and by no means widely implemented, but appear to continue the movement toward local autonomy in production decisions. As with the 6.28 measures, these policies also encourage more rational economic practices for manufacturing enterprises outside the agricultural sector.
Will the government continue in this direction? Kim Jong Un’s 2015 New Year’s Address gives little indication. As in 2014, only one paragraph is devoted to agriculture and emphasizes use of scientific farming methods, provision of adequate farming materials and “guiding production in conformity with actual conditions.” The latter phrase may decode in favor of management autonomy at the SWT level, but only time will tell. A renewed emphasis on livestock and fish production hints at previous efforts to find magic bullets. But numerous past failures to implement intensive livestock production programs do not inspire optimism. Until there is enough food for people, confined animal feeding operations will be of marginal utility at best.
Given the DPRK’s history of policies that have not been fully implemented, it is reasonable to ask if anything is really changing at the farm level. Because of the timing of their announcement, the 6.28 changes were fundamentally irrelevant in 2012. But numerous published and informal sources generally report that beginning in 2013, the changes in SWT structure were gradually implemented, although resisted by some agricultural bureaucrats and the military that feared loss of influence and preferred access to food. They now appear to have taken hold across the country. Details are scarce regarding how inputs such as fertilizer, seed, fuel and access to the large farm machinery held by a cooperative farm are shared among SWTs. Moreover, there is without doubt substantial variation among cooperative farms, and the methods are still evolving. According to NGO sources, arrangements are mostly being worked out at the cooperative farm level. This is significant as it reflects an apparent willingness of the government to allow local autonomy on these matters.
Yield sharing is another critical issue. The promise of 30 percent of the crop quota was intended as a strong motivator to SWTs to increase their effort and efficiency. A few reports suggest that not all local officials were willing to allow farmers to keep their full share. Whether surplus can be sold in the open market or must be delivered to the state is also something that seems to vary by locality. But the latest 5.30 policy doubles the farmers’ share to 60 percent, suggesting that the government is finding the incentive structure effective and is also willing to allow substantial marketization of grain. That itself is a significant modification of previous practice. According to Andrei Lankov, another element of the 5.30 measures is the allocation of 1,000 pyong (3300 m2 or .8 acre) to each farming household as their kitchen garden. Compared with the initial effort in early 2013 to reduce household plots under the 6.28 policies, such a dramatic increase from the long-standing 100 m2 of household garden will certainly change family management practices. Given the typical population to land ratio of DPRK cooperative farms it will also remove a significant portion (likely between 10 and 20 percent) of each cooperative farm’s cropland from the regulated production system. Will this really happen? We should begin to see any changes in this coming June’s planting patterns.
The other main obstacle to improving farm production has been the inability of farms or SWTs to invest any surplus or profit in increasing productivity—for example, more fertilizer, better seed, two-wheel tractors or fuel. But again a variety of anecdotal reports suggest that at least some farm supplies from China are making their way into the market system, and hence being used to buttress productivity.
Does Any of This Matter?
The near complete ineffectiveness of earlier policy changes in raising farm production gives rise to a good deal of skepticism about recent changes, but production results suggest things may be changing. The FAO Crop and Food Security report for 2013 estimated total food production as 5.03 million metric tons (MMT) grain equivalent, the highest level since the beginning of the DPRK economic collapse in the early 1990s. The estimated food shortfall was thus only 340,000 MT. It would be reasonable to attribute at least some of this improvement to greater efficiency and effort by the farm SWTs, and by extension to the policy changes that had gradually been implemented. 2013 was the first year in which one could say the 6.28 measures were being implemented. Fertilizer availability was less in 2013 than 2012, and there was a period of heavy rain that damaged some crops as well. So increased production may reflect both increased motivation at the SWT level, and an increased ability to farm efficiently with limited resources—increased use of compost, some more crop rotation, more thorough weeding, etc.
Following this good harvest, grain imports in 2014 were initially at a low level, but increased substantially in July and August following a sudden increase in the market price of rice. Prices shortly subsided to previous levels. The rise in imports suggests that the government is monitoring market prices, expects people to secure food in the market, and is actually using economic measures to regulate those prices. This implies a growing acceptance of relying on the market mechanism for distribution of staple foods, a view that is supported by other anecdotal reports. Nonetheless, grain imports from January through August 2014 only came to about 104,000 MT, well short of the 340,000 MT requirement.
We do not have really good production data for 2014 (yes, one can argue that we have never had really good production data), but despite an extended period of drought during the critical early spring period, and no increase in fertilizer availability, grain production is similar to 2013. The FAO/WFP did not carry out a Crop and Food Security Assessment Mission in 2014, so it did not perform the extensive field checks characteristics of such a mission. But the FAO estimates rice production (grain) at 1.9 MMT, the same as for 2013, and maize production as 2.3 MMT, compared with 2.2 MMT in 2013. The USDA using different methodology estimated an increase in rice production from 1.74 to 1.88 MMT in 2014. So as best we can tell, production is at least holding steady, if not slowly continuing to grow. Lacking unfettered access to farming supplies, there is only so much a motivated SWT can do to increase its productivity.
If, as seems the case, the government is allowing the markets to function more broadly, and to allow, by whatever means, goods and supplies to be imported, then one can expect that farmers’ access to critical supplies—fertilizer, walk-behind tractors, fuel, better seed—will gradually increase. That will almost surely lead to further production increases, as well as spending on consumer goods which should also help the national economy. This is not an agriculture-led development scenario, but at least would be a positive step forward from the relative stagnation of the last several years.
But let’s not be overly ebullient: the actions to date do not constitute a Chinese- or Vietnamese-style economic reform, and the DPRK will remain food-insecure for the immediate future. Rollbacks and opposition to other recent changes in farm policy argue for a wait-and-see approach. The 5.30 policies appear to implicitly accept the inevitability of a strong market for distributing foodstuffs, and the need for farmers to capture a much larger share of their production than has been allowed in the past. However, they do not eliminate production quotas or state supply of primary farming supplies. Changes in other sectors of the economy suggest that perhaps a gradual liberalization process is both foreseen and underway—with an emphasis on “gradual.” At the farm level, the coming year will be instructive, both in terms of whether the 6.28 and 5.30 policies are fully implemented, and whether farmers can take advantage of this new autonomy to increase production. We can be hopeful.
 Regarding the initial limited implementation, see “6.28 Policy goes live in 3 Yanggang counties,” Daily NK, July 20, 2012, http://www.dailynk.com/english/read.php?cataId=nk01500&num=9551; and “North Korea’s new economic management measures stalled,” NK Briefs, Institute for Far Eastern Studies, October 18, 2012, http://ifes.kyungnam.ac.kr/eng/FRM/FRM_0101V.aspx?code=FRM121018_0001. Two representatives of aid programs in the DPRK report that in 2014, the reforms seem to be much more widely, if not universally, implemented.
 Kim So Yeol, “Cabinet Acknowledtes June 28th News,” Daily NK, May 13, 2013, http://www.dailynk.com/english/read.php?cataId=nk09002&num=10565; Lee Sang Yong, “Agricultural Madness Angers Farmers,” Daily NK, July 5, 2013, http://www.dailynk.com/english/read.php?num=10713&cataId=nk01500; Park Hyeong-jung, “North Korea’s ‘New Economic Management System’: Main Features and Problems.” Korea Focus, October 2013, http://www.koreafocus.or.kr/design3/essays/view.asp?volume_id=146&content_id=105092&category=G; at the end of 2013, the FAO reported no evidence of any changes in agriculture market policy: FAO/WFP, Crop and Food Security Assessment Mission to the Democratic Peoples Republic of Korea (Rome: FAO and WFP) 9-11, http://www.fao.org/docrep/019/aq118e/aq118e.pdf.
 “May 30th Measures and IFES Report,” Choson Exchange blog, December 3, 2014, http://www.chosonexchange.org/our-blog/2014/12/3/may-30th-measures-and-ifes-report.
 See the comprehensive review: Park Hyeong-jung, “North Korea’s ‘New Economic Management System’: Main Features and Problems.” Korea Focus, October 2013, http://www.koreafocus.or.kr/design3/essays/view.asp?volume_id=146&content_id=105092&category=G.
 For example, see: Sung-hui Moon, “Farmers in North Korea lose faith in crop-distribution policy,” Radio Free Asia, October 20, 2014. http://www.rfa.org/english/news/korea/grain-policy-10202014163233.html; Seol Song Ah, “Poor harvest complicates June 28th measures,” Daily NK, December 5, 2014, http://www.dailynk.com/english/read.php?cataId=nk01500&num=12641.
 Andrei Lankov, “Reforming North Korea,” Al Jazeera, November 30, 2014, http://www.aljazeera.com/indepth/opinion/2014/11/reforming-north-korea-20141117121917871925.html .
 “Special Report: Crop and Food Security Assessment Mission to the Democratic People’s Republic of Korea.” (Rome: FAO/WFP) November 2013. “Grain equivalent tons” is a method for reconciling the different moisture and husk characteristics of staple crops such as corn, rice and potatoes.
 “Markets see quick spike in rice prices,” Daily NK, July 25, 2014, http://www.dailynk.com/english/read.php?num=12126&cataId=nk01500.
 “Market prices stable despite lean period,” Daily NK, May 16, 2014, http://www.dailynk.com/english/read.php?num=11871&cataId=nk01500.
 “Sharp increase in grain imports from China in second half of 2014,” NK Brief no 14-10-16, Institute for Far Eastern Studies, October 16, 2014, http://ifes.kyungnam.ac.kr/eng/FRM/FRM_0101V.aspx?code=FRM141016_0001 .