China's grain output, which includes rice, wheat, corn and soybean, exceeded 500 million tons this year, making it the fourth consecutive year of output increase since 2004.

The announcement by China's Minister of Agriculture Sun Zhengcai on Saturday came as the country hoped a bumper grain output would help slow current price rises.

Huge rises in food prices lifted the nation's consumer price index (CPI) to an 11-year high of 6.9 percent in November. Prices of food, which has a 33 percent weighting in CPI, soared 18.2 percent last month.

The high inflation had become a major concern of the government for fear it could worsen in the future and make the lives of poor people much more difficult.

However, Sun said the output still fell short of demand this year, without giving the exact figure for grain demand.

He said the grain supply per capita dropped from 412 kilograms in 1996 to 378 kg last year. Historically, grain output had fallen until 2004 after peaking at 512 million tons in 1998.

China was also facing great challenges in feeding its huge population of more than 1.3 billion with shrinking farmland and more farmers relocating to towns and cities.

The country would have to maintain an annual grain output of 500 million tons up to 2010 if it wanted to ensure an adequate food supply.

In face of rising food prices, China scrapped export rebates for 84 agricultural products on Thursday in effort to discourage exports of farm produce. This, in effect, would help increase domestic supply.

Sun said increasing grain production would be a top priority for the ministry in 2008, along with a boost in cooking oil and live pigs. Rising pork and cooking oil prices were major factors behind the rising CPI figure.

Sun also said the average income of rural people would be expected to top 4,000 yuan ($543) per person this year, an increase of seven percent from last year. The figure was still far below the more than 10,000 yuan per person for urban residents.

The ministry said it would strive to keep grain output above 500 million tons next year, and hoped to increase the income of farmers at the same time, Sun said.

However, circumstances were not favorable due to a tight global grain supply, decreasing rural labor and farmland and higher production costs driven by rising energy prices.

The extreme weather as a result of global climate change would also make agricultural disaster prevention and reduction more difficult.

National disasters in the first nine months of 2007 resulted in a loss of 44.5 million tons of grain.

China, however, has been over 95 percent self-sufficient in grain production in the last 10 years and its grain security was guaranteed, said Agriculture Vice Minister Yin Chengjie earlier this year.