North Korea Wednesday repeated demands for sanctions to be lifted before it returns to nuclear disarmament talks, resisting appeals from its ally China to resume dialogue, a news report said.

Pyongyang's nuclear negotiators were holding a second day of talks in Beijing amid international efforts to kickstart the stalled negotiations, South Korea's Yonhap news agency reported from the Chinese capital.

North Korea restated its stance that it would not come back to the six-party forum as long as sanctions are in force, Yonhap quoted a diplomatic source as saying.

It urged China, as a permanent UN Security Council member, to play an active role in lifting the UN sanctions, the source said.

The negotiators also reportedly sought Beijing's backing for their demand that the United States agree to start talks about a permanent peace treaty before the nuclear forum resumes.

China stressed North Korea should first return to the dialogue table and ease its tough conditions, the source was quoted as saying.

The United States says the North must come back to the nuclear talks and reaffirm commitment to previous agreements before other matters are discussed.

Pyongyang was reportedly playing hardball despite its own worsening food shortages and international efforts to revive the six-party forum.

UN chief Ban Ki-moon's top political adviser Lynn Pascoe is making a four-day visit to the North expected to focus on both nuclear matters and humanitarian aid, the first by a high-level UN official since 2004.

Pascoe, under-secretary general for political affairs, held talks Wednesday with Foreign Minister Pak Ui-Chun, Pyongyang's official news agency reported.

The North angrily quit the nuclear talks last April following international criticism of its ballistic missile launch. It staged its second atomic weapons test the following month and vowed to restart plutonium production.

China sent senior communist party official Wang Jiarui to North Korea Saturday to try to coax it back to the forum chaired by Beijing since 2003. It also groups South Korea, the United States, Russia and Japan.

At a meeting with Wang, leader Kim Jong-Il reaffirmed his commitment in principle to denuclearisation, China's Xinhua news agency said. But there was apparently no firm pledge to return to dialogue.

Despite the apparent tough line, some analysts believe the North is desperate to end its international isolation as food shortages grow and the overall economy worsens.

South Korea's unification ministry estimated Wednesday that the communist state faces a shortfall of 1.29 million tons of grain this year, equivalent to almost four months' food supply.

"North Korea desperately wants a breakthrough to revive its worsening economy," Yang Moo-Jin of Seoul's University of North Korean Studies told AFP Tuesday, saying the six-party talks would likely resume in March.

International aid to North Korea, which suffered a full-blown famine in the 1990s, has largely dried up or been rejected as political tensions grew over its weapons programmes.

Tighter UN sanctions imposed last June have also crimped its weapons exports, an important earner in the past.

Last November's shock currency revaluation aimed at clamping down on free-market activities sent prices soaring and provoked some outbreaks of violent unrest, according to South Korean groups.

Welfare group Good Friends said in its newsletter that the North's Premier Kim Yong-Il, who is in charge of the economy under Kim Jong-Il, has apologised for the bungled exercise.