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The agricultural policy panel of the ruling Liberal Democratic Party on Friday called on the government to give farmers more freedom in running their paddies.

The LDP panel made the proposal in an outline of rice policy reforms, which calls for shift to a new production system by fiscal 2008.

However, the panel refrained from touching on the most contentious issue in such reforms — when the government should abolish the 30-year-old program to encourage farmers to cut back on the acreage of rice farms and grow other types of crops in exchange for financial compensation.

The government introduced the program in fiscal 1971 in a bid to reduce oversupply and prevent a plunge in rice prices resulting from dwindling demand for rice.

However, it changed its stance earlier this year. A research panel on acreage reduction, set up by the Food Agency, called for overhauling the nation’s rice production system in a report released in June, with an eye to future abolishment of the rice paddy reduction program.

Behind the change is the fact that the acreage reduction and subsidy program has reached its limit — both physically and financially — while Japanese are eating less rice, which increasingly threaten the status of rice as Japan’s staple food.

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