Staple foods are likely to get more expensive as firms have to pay more for basic ingredients such as corn and wheat, experts warned today.
Wheat prices across the US and Europe hit their highest levels in more than a decade last month, according to business advisory firm Deloitte.
And corn has doubled in price over the past 18 months to hit £2 per bushel or £84 per tonne.
Bread could go up in price by around 5p per loaf in the UK as a result of rising wheat prices, Deloitte food and agriculture partner Mark Hill said.
Milk and meat
Milk and some meat may also get more expensive as farmers have to spend more on the grain used to feed their animals.
Mr Hill warned: ‘Overall, the long term supply and demand issues for grain could lead to sustained increases in the price of food commodities.’
Predicted growth in the world population from the current six billion to nine billion by 2050, plus growing consumer affluence in China and India, could double global grain consumption within the next 40 years, according to Deloitte.
Grain supplies have already been put under pressure by bad weather which reduced harvests and pushed up prices last year.
The increasing trend for using grain crops to make biofuels, which are an alternative to fossil fuels, is putting further pressure on supplies.
Mr Hill said: ‘Stocks at all points in the food chain have been run down and consequently there is no price damper on production volatility or safety net when world demand for grain exceeds production.’
Although the EU has four million hectares of land which could be returned to farm production, much of this is used for environmental schemes, Deloitte said.
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