South Korea is seeking a balance between the supply and demand of rice by 2018 through a gradual reduction in the size of paddies and expanding consumption, the government said Wednesday.

The Ministry of Agriculture said it wants to reduce the amount of arable land set aside to grow rice from 799,000 hectares this year to 711,000 hectares in 2018. This is significantly smaller than the expected 749,000 hectares of paddies that would be in service even if no action is taken.

It said that in the next three years the government wants to increase annual per capita rice consumption to 58.1 kilograms. This is smaller than the 65.1 kg estimated for 2015, but higher than the 57.4 kg projected if no measures are taken.

In addition to reducing the size of arable land and fueling consumption, the government will reduce the size of rice held in reserve from 1.63 million tons as of November 2015 to just 800,000 tons in October 2018. Smaller reserves translate into lower costs for the government that has to maintain them.

"There is a need to deal with imbalance in supply and demand," said Deputy Agriculture Minister Oh Kyung-tae. He pointed out that in the last 10 years, Asia's fourth largest economy on average produced 280,000 tons of rice per year more than it consumed.

"If no measures are taken it will still produce 240,000 tons of rice per year more than it needs," the official said.

As part of this effort, the ministry said it will encourage farmers to raise non-rice produce on their lands, ask them to produce more high-quality, lower-yield grains, and get private-sector rice-producing plants to nudge farmers to follow state policy.

To increase demand, the government will move to use more rice to make livestock feed and alcoholic beverages.

In the past, when South Korea did not produce enough rice, such practices were not allowed. To further increase demand, the government will support the export of processed food that uses rice as a base ingredient.

In the move to lower rice reserves the government plans to release more grain for animal feed and lower prices of rice given to the socially disadvantaged.

The agriculture ministry said that by taking such action, the government can save upwards of 300 billion won ($256 million) on expenses and help stabilize the prices of the staple grain, which can help farmers. (Yonhap)