ROME (Reuters) - Food production in North Korea has risen for a second year but the impoverished country still faces shortages and widespread malnutrition, the United Nations' Food and Agriculture Organization on Monday.

The U.N. organization forecast a 10 percent increase in the main 2012 harvests and 2013 early season crops compared with a year earlier, and said production was expected to hit 5.8 million metric tons.

The country faced a staple food deficit of 207,000 metric tons, the lowest in many years, but 2.8 million people remained vulnerable to undernutrition, the FAO added.

The body issued its findings after carrying out a mission to the isolated country to measure its cereal production.

"DPR Korea still needs international help," Kisan Gunjal, FAO economist and the mission's co-leader, said in a statement. "The new harvest figures are good news, but the lack of proteins and fats in the diet is alarming."

A 30 percent decline in soybean production due to a prolonged dry spell in the first half of 2012 was of particular concern, said the report.

The North accepted aid from its rival South Korea in September for the first time after floods destroyed swathes of farmland during the summer.

(Reporting by Naomi O'Leary; Editing by Andrew Heavens)