The Chinese government yesterday announced food subsidies for poor families as it tried to cool a double-digit surge in prices that communist leaders fear could stir unrest.

The cabinet promised to ease shortages of vegetables and grain that helped push up food prices by more than 10% last month. It promised more supplies of diesel to end fuel shortages that have disrupted trucking and industry.

Cabinet members said they were not ordering direct price controls, but said those could be imposed if necessary.

It said Beijing would release stockpiles of grain, cooking oil and sugar to increase supplies in the market. It promised more money to subsidise school meals for poor children, and said local authorities had been ordered to increase supplies of vegetables.

Inflation is politically volatile in China, where poor families spend up to half their incomes on food.

Rising incomes have helped to offset price increases, but inflation erodes the gains that help support the ruling Communist party's position in power.

"Inflation is one of the biggest political issues today," Robert Broadfoot, the managing director of the Political and Economic Risk Consultancy, in Hong Kong, said. "I think you're going to see isolated demonstrations over living costs."

The jump in food prices – which has been blamed on summer storms that damaged crops – pushed inflation to a 25-month high of 4.4% last month, well above the government's 3% target.

Surging food prices are not confined to China, with agriculture in other countries also hit by unpredictable weather from drought to storms and floods.

The UN Food and Agriculture Organisation said global prices of most commodities were up sharply from last year, with further spikes likely unless the production of main food crops rose.

In its Food Outlook report, the FAO said the international community must remain vigilant against further supply shocks in 2011.

McDonald's raised the prices of hamburgers, drinks and other items due to higher costs, the official Xinhua news agency said. In a written response to questions, the company cited a "rise of commodity cost".