CHINA, the biggest user of soybeans and vegetable oil, plans to expand output of oilseed crops by 14 percent.
It will achieve the result through greater subsidies and higher yields, while also boosting stockpiles to help manage surging demand, Bloomberg News reported.
"Boosting production of oilseed crops to ensure supply is an urgent task," the State Council said in a statement on its Website late on Monday. "Our basic principle is to maintain our dependence on domestic sources for supply."
China's soybean output this year may fall to the lowest since 1999 on lower planting and drought, the China National Grain and Oils Information Center said on September 10.
Inflation for edible oils jumped to 35 percent last month on rising demand.
"These polices were well-intended but arrived too late," said Chen Baomin, an analyst at Jilin Grain Group Co in Changchun. "Given the current high prices, farmers will plan more oilseed crops with or without subsidies."
Soybean futures in China, traded on the Dalian Commodity Exchange, rose 27 percent in the past six months on the reduced output and increased demand for oil and soybean meal. They were at 4,083 yuan (US$543) a ton at the end of the morning session.