North Korea has steadily increased state control over the country’s grain trade through legal amendments, shifting these activities away from autonomous markets. A significant change came two years ago when the law was modified to strengthen state authority over grain sales and establish state-run grain shops.
The grain law, amended by Ordinance No. 1145 of the Supreme People’s Assembly’s Standing Committee in December 2022, expanded from 57 to 61 articles while maintaining its six chapters. The law’s stated mission, as outlined in Chapter 1, Article 1, is to “develop grain activities by strictly establishing a system and order in the procurement, storage, processing, supply, sale and consumption of grain while hastening the construction of the socialist economy and contributing to improving the people’s lives.”
The addition of the word “sale” to this mission statement signals the government’s intent to legitimize state-run grain shops. The amendment also introduced more detailed control over grain procurement. While the previous version simply required agricultural guidance agencies to “draw up organized activities and procure grain on time,” the 2022 law specifies they must “procure grain on time by seamlessly organizing the harvest, threshing, drying, packaging and transport.”
The law also emphasizes hygiene in grain processing. Previously, processors were only required to “eliminate processing losses by improving grain processing and equipment through science and technology.” The amended version requires grain processing enterprises to eliminate losses by “modernizing” processing and maintaining “sanitary and cultured” management practices. Recent reports indicate that grain processing facilities have implemented mechanical sorting and packaging systems and increased sanitation inspections.
Articles 43 and 44 introduce specific regulations for the grain trade. The law now details fixed supply amounts based on work difficulty and position, prohibits unauthorized alterations to these amounts, and requires sellers to process and sell food either by order or monthly schedule. These new provisions suggest an effort to systematically manage limited grain supplies.
State-run grain shops have been granted some autonomy in procurement and sales through Article 45, which allows them to “carry out activities to purchase and sell available grain as arranged.” However, this autonomy comes with strengthened oversight and penalties. The law imposes fines of 1-1.5 million North Korean won (around $120-$180) on organizations and 1 million won ($120) on individuals for selling grain on the black market or using it to make moonshine. Organizations that fail to distribute grain within the state system face similar fines. Those ignoring supervisory agencies’ demands risk business suspension or closure.
According to Daily NK researcher Hwang Hyun-uk, these detailed penalties reflect “an attempt to maximize the state’s management and control over grain” while acknowledging the semi-corporate nature of grain-selling agencies through the inclusion of business closure as a possible punishment.
