China's Cabinet on Wednesday approved a plan to ensure the country would be 95 percent self-sufficient in grain over the next 12 years after hearing how farmers faced tremendous challenges in increasing output.

The State Council agreed at an executive meeting the plan to ensure grain output exceeds 500 billion kilograms until 2010, and reaches 540 billion kg by 2020.

Sprawling industrialization and urbanization pushed up demand, while land and water shortages, as well as climate change, hurt production, the meeting, presided over by Premier Wen Jiabao, heard.

The State Council agreed the country faced grim challenges in grain security.

They approved a mid to long-term plan to ensure national grain security, which would make the country more than 95 percent self-sufficient.

Relentless efforts should be made to ensure a minimum of 120 million hectares of arable land. Agriculture infrastructure and water facilities should also be improved, the meeting was told.

Grain production subsidies would increase annually to boost farmers' incomes, but no details were given.

They also approved a plan to help the northwestern Jilin Province, one of the major grain-producing provinces, to increase output by more than 5 billion kg in five years, as a matter of strategic importance to national grain security.

China produced 501.5 million tons of grain last year, 15 million tons less than the total demand.

However, Premier Wen Jiabao has said the country has 40 to 50 million tons of rice reserves to cushion it against global price rises.

This year, the country could see the fifth consecutive bumper harvest of summer grain, the first such run of harvests since 1949, the Ministry of Agriculture has said.

The summer crops, which usually account for about 23 percent of the nation's annual grain output, would surpass the 115.34 billion kg for 2007, the ministry said.