Agricultural policy describes a set of laws relating to domestic agriculture and imports of foreign agricultural products. Governments usually implement agricultural policies with the goal of achieving a specific outcome in the domestic agricultural product markets. Well designed agricultural policies use predetermined goals, objectives and pathways set by an individual or government for the purpose of achieving a specified outcome, for the benefit of the individual(s), society and the nations' economy at large. The goals could include issues such as biosecurity, food security, rural poverty reduction or increasing economic value through cash crop or improved food distribution or food processing.

Agricultural policies take into consideration the primary (production), secondary (such as food processing, and distribution) and tertiary processes (such as consumption and supply in agricultural products and supplies). Outcomes can involve, for example, a guaranteed supply level, price stability, product quality, product selection, land use or employment. Governments can use tools like rural development practices, agricultural extension, economic protections, agricultural subsidies or price controls to change the dynamics of agricultural production, or improve the consumer impacts of the production.

Agricultural policy has wide reaching primary and secondary effects. Agriculture has large impacts on climate change, with land use, land-use change, and forestry estimated to be contributing 13–21% of global annual emissions as of the 2010s. Moreover, agricultural policy needs to account for a lot of shocks to the system: for example, agriculture is highly vulnerable to the negative impacts of climate change, such as decreases in water access, geophysical processes such as ocean level rise and changing weather, and socioeconomic processes that affect farmers, many of whom are in subsistence economic conditions. In order for global climate change mitigation and adaptation to be effective a wide range of policies need to be implemented to reduce the risk of negative climate change impacts on agriculture and greenhouse gas emissions from the agriculture sector.

An example of the breadth and types of agriculture policy concerns can be found in the Australian Bureau of Agricultural and Resource Economics article "Agricultural Economies of Australia and New Zealand" which says that the major challenges and issues faced by their industrial agriculture industry are:

Policymakers working in poverty reduction in the agriculture sector assess, plan, or enact policies aimed to address the needs of persons living in poverty. Agriculture has been a critical driver of poverty reduction in most developing countries, particularly in rural areas. Approximately 80% of the world's impoverished population, who primarily reside in rural areas and earn their livelihood through farming, can benefit from agriculture in terms of poverty reduction, income generation, and food security. Fostering agricultural development is therefore a crucial element of agricultural policy in a developing country. In addition, a recent Natural Resource Perspective paper by the Overseas Development Institute found that good infrastructure, education and effective information services in rural areas were necessary to improve the chances of making agriculture work for the poor.

During the 1980s and 1990s, there was a disregard for the agriculture sector among policymakers and investors, only regaining interest when the prices of staple food crops experienced a significant increase in the mid-2000s. As a result of agricultural policy neglect, there has been a scarcity of investment in infrastructure, which has hindered agricultural development and public goods, such as education, research and development and technology. Rural productive sectors and small agricultural enterprises suffer from market failures due to policies favouring urban areas and lending policies biased against small-scale agricultural firms. Neglect in implementing agriculture policy has been detected in several developing countries. In Indonesia, since the 1997 Asian financial crisis, the government's agricultural policy has been closely concentrated on achieving price stability and self-sufficiency for import-competing commodities, such as palm oil, sugar and rice.

International agencies such as the Food and Agriculture Organization (FAO), the World Bank, the International Fund for Agricultural Development (IFAD) and the Organisation for Economic Co-operation and Development (OECD), espouse the prioritisation of agricultural endeavours to support poverty reduction. The impact of agricultural policy on reducing poverty differs across countries and is influenced by a variety of factors, such as the level of government policy support, the degree of public and private investment in agriculture, the different types of agriculture, and the growth rates of agriculture parallel to non-agriculture sectors. In particular, investment in agricultural research and development has been shown to be highly influential on agricultural GDP growth and poverty reduction. Government policies play a key role in promoting agricultural activities, such as irrigation systems, roads and telecommunication systems, land reform, power in rural areas, fiscal support for research and development, pricing policies, assistance for new technologies, and markets for agricultural produce. Agricultural policies have contributed to meeting the goals related to increasing, diversifying, and improving agricultural production.

Agricultural policies aimed at reducing poverty include India's Pradhan Mantri Fasal Bima Yojana, which offers crop insurance to farmers to protect them from weather-related uncertainties and potential crop failures.^{[citation needed]} This initiative provides farmers with financial aid for crop loss, reducing the risk of falling into poverty. Rwanda's Crop Intensification Program is another example of such policy, which provides farmers with inputs like fertilisers, improved seeds, and pesticides, as well as training and technical support to help them adopt more efficient farming practices. However, for agricultural policies to contribute to poverty reduction, it is essential that they collaborate effectively and cohesively with other sectors, such as tourism, sustainable economy, and industry.