North Korean authorities set up state-run grain sales offices to stabilize food supplies and prices, but many of these shops are now run behind the scenes by wealthy private merchants known as donju. The donju‘s involvement has modestly improved the quality of the grain sold. Yet prices at the offices increasingly track market rates, and North Korean people are growing convinced the shops are little different from private rice dealers.
A source in North Pyongan province told Daily NK on Friday that grain sales offices in Sinuiju and other areas are effectively run by donju who once worked as major rice wholesalers. These donju procure and sell grain, but they do so under the direction and oversight of the local people’s committee’s grain administration department.
“Many of the people running the grain sales offices are donju who used to trade large volumes of rice in the markets,” the source said. “They take direction from the grain administration department, but the donju are really the ones running things.” The offices formally remain under state control on paper. But day-to-day operations, including securing and selling grain, fall to the donju, the source added.
Filling a procurement gap
North Korean authorities appear to have brought in established rice wholesalers largely to make up for the state’s weak grain procurement capacity. Running a grain sales office requires a steady, sizable supply of grain, but state agencies often lack the funds and distribution networks to buy enough on their own.
Wholesalers, by contrast, have built purchasing networks with farms, producers and middlemen over years of trading. That gives them an edge over state agencies in securing supply quickly. By bringing donju into the grain sales offices, authorities can offset their own procurement shortfall. They also lock in steady sales volume without building a separate distribution network.
The donju‘s experience selecting and managing grain appears to be another draw. Since donju became involved, the quality of rice sold has reportedly improved somewhat. Merchants with deep trading experience and their own distribution networks have taken a hand in securing supply and managing quality.
The arrangement also appears designed to pull major grain merchants back into the state’s official system. These merchants once operated independently in the markets for years. By having them work within official grain sales offices instead, authorities gain some visibility into distribution volumes and price trends. The setup also creates opportunities to collect fees or payments during sales.
In short, North Korean authorities appear to be drawing on private capital and distribution networks to cover the state’s own shortfalls. At the same time, they are pulling private grain trading into the official management system.
Even so, North Korean people say they feel little benefit from price stability, despite the fact that donju effectively run the grain sales offices. People initially expected the state to use the offices to keep market prices from rising too high; however, in practice, prices at the offices often rise in step with the market, the source explained.
At times, the grain sales offices have even raised prices before the market did, with market prices following suit afterward. “At first, I thought the state had set up the grain sales offices so rice wouldn’t be sold at too high a price,” the source said. “But in the end, the sales office prices rise right along with the market. Sometimes the sales offices raise prices first, even before the market does.”
Grain prices at the sales offices are typically somewhat lower than market prices, but the gap has been narrowing steadily. When the offices first launched, prices there were about 30% lower than the market. That gap has since narrowed to under 5%.
Rice at the sales offices is generally 500 to 1,000 North Korean won cheaper per kilogram than in the markets, but during recent stretches of sharp price increases, sales office prices have sometimes exceeded market prices. “North Korean people see the grain sales offices as just another place where a private merchant sells rice,” the source said. “Not many people think of it as the state supplying rice to the people.”
Reporting from inside North Korea
Daily NK operates networks of sources inside North Korea who document events in real-time and transmit information through secure channels. Unlike reporting based on state media, satellite imagery, or defector accounts from years past, our journalism comes directly from people currently living under the regime. We verify reports through multiple independent sources and cross-reference details before publication.
Our sources remain anonymous because contact with foreign media is treated as a capital offense in North Korea — discovery means imprisonment or execution. This network-based approach allows Daily NK to report on developments other outlets cannot access: market trends, policy implementation, public sentiment, and daily realities that never appear in official narratives.
Maintaining these secure communication channels and protecting source identities requires specialized protocols and constant vigilance. Daily NK serves as a bridge between North Koreans and the outside world, documenting what’s happening inside one of the world’s most closed societies.
August 10, 2026 at 10:49PM
by DailyNK(North Korean Media)