The United States has agreed to allow Japan to retain tariffs on rice and wheat, government sources said Thursday during bilateral talks related to the wider Pacific free trade negotiations.

In return, Washington demanded Tokyo introduce a system to increase U.S. rice imports, which the Japanese side agreed to do, the sources said.

Among the five "sacred" farm product categories Japan regards off-limits — rice, wheat, beef and pork, dairy products and sugar — products such as sugar cane are also likely to be exempted from the basic principle of abolishing all tariffs under the Trans-Pacific Partnership framework, since both Tokyo and Washington want to protect them, the sources said.