The interaction of Japanese rice and wheat policies and their impact on trade is described and analyzed through estimation of an econometric model which includes the interrelationships between the two sectors and which reflects Japanese Government policies. The model is used to simulate the trade impacts of previously announced increases in wheat support prices and in diversion payments over a 5-year period. Results indicate that the price changes reduce wheat imports 4-5 percent (from 1973 base levels) and also the accumulation of excess rice stocks which have given rise to Japan's emergence as a rice exporter in recent years.