December 6, 2011

China's bumper grain harvest and larger-than-expected corn output this year would help the government battle inflation amid economic turmoil in the US and Europe, a Chinese researcher said.

Grain output rose 4.5% this year to a record 571.21 million tonnes, marking the eighth consecutive year of growth, the National Bureau of Statistics said.

The bureau announced a record 191.75 million tonnes of corn production this year, up 8.2% from last year's harvest. Market analysts had predicted a harvest of between 180 million and 185 million tonnes.

The mainland's consumer price index (CPI) has risen more slowly in recent months after increasing by a three-year high of 6.5% in July. October CPI growth eased to 5.5% from September's 6.1%.

The government has launched a slew of measures to fight soaring prices this year, with Premier Wen Jiabao saying that curbing price rises is the government's top priority.

"It (the harvest) is of great significance in regard to our efforts to achieve overall price stability and to consolidate our achievements in macroeconomic adjustment and control," said Li Guoxiang, a researcher with the Chinese Academy of Social Sciences' Research Institute of Agricultural Development.

Rice production increased 2.6% to 200.78 million tonnes this year, with wheat production up 2.4% to 117.92 million tonnes, the bureau said, citing subsidies - at RMB141 billion (US$22 billion) this year - and favourable weather conditions as reasons for the healthy harvest.