UK Food prices to rise sharply as floods ruin crops
Pastor Dale Morgan
UK Food prices to rise sharply as floods ruin crops*
By Nick Britten
Last Updated: 2:35am BST 10/07/2007
Crops in the fields near Doncaster, South Yorkshire, where eighty per
cent of the homes are still under water
Food prices will soar in the coming months after the recent flooding
wiped out huge swathes of the country's crops, experts warned yesterday.
A predicted shortage of vegetables - including potatoes and peas, and
cereals such as wheat - is likely to cause manufacturers and retailers
to push their prices up and increase food-price inflation.
Fields in prime vegetable growing areas of Yorkshire and Lincolnshire
remain under water and only an extended dry period will give farmers any
hope of salvaging this year's crop.
The cost of traditional fish and chips is already rising, according to
the British Hospitality Association, which cites supply problems with
all the principal ingredients.
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And, according to the National Union of Farmers, supermarket shoppers
should brace themselves for a sharp rise in staple foods such as bread
and vegetables, both fresh and frozen.
Paul Temple, the NFU vice-president, said: "There's a monumental
struggle going on for growers at the moment with vegetables like peas,
and it's bound to have an effect on food inflation, although it's too
early yet to say how severe that effect will be. A lot will depend on
how the retailers pass it on."
The price of bread has already risen this year because of a grain and
wheat shortage, largely caused by last year's crop failure due to the
heat wave, and the latest floods will only exacerbate the situation.
Hovis put up the price of a standard loaf from 93p to 99p in February,
and further rises are predicted.
Overall, food prices rose by 4.9 per cent in the year to May, more than
double the Bank of England's two per cent target for consumer price
inflation. According to the Office for National Statistics, vegetable
prices, including potatoes, were up by 9.6 per cent during the same
period while the price of fish rose by 12.7 per cent.
Other factors, including high oil prices - leading to an increase in
farmers' transport and fertiliser costs - and rising global demand for
agricultural raw materials and biofuels is also pushing up food
inflation. Greater food shortages loom as more farmers, demoralised by
falling profit margins and incentivised by high biofuel prices, begin
growing crops for fuel rather than food.
But it is the recent bad weather that is causing most concern. Flooding
has caused havoc for frozen vegetable crops, with peas being amongst the
worst hit.
Tim Mudge, the commercial manager of the Processed Vegetable Growers
Association, said that around 30 per cent of the crop had been wiped
out. "We cannot get to the crops that are ready because they are under
water and cannot be reached and the peas planted to replace them are
simply sitting in mud and not growing.
"There is only a 12- to 18-hour window to get the peas at their optimum
maturity and get them to the factory. After that the peas start going
off. So it's easy to see how the current weather has caused so many
problems.
"Prices are bound to go up but most suppliers are on fixed contracts so
won't see the benefit. A lot of supermarkets say they want to support
farmers and now is the time farmers need their help."
He added that vegetables sold fresh, including cabbages, cauliflowers
and broccoli, had also been badly hit.
Even meat prices may be affected. With so much wheat and soya being
lost, the price of animal feed has risen, which could mean more
expensive chicken and beef, especially organic varieties.
Mr Temple said: "A farmer in Yorkshire told me that he had lost 50 of
his 53 acres. Another said the cost of his cattle feed had gone up by 28
per cent. That shows you how quickly prices are changing and how serious
the situation is for individual farmers."
The Food and Agriculture Organisation has forecast that the growth of
the biofuels industry could drive up international food prices by
between 20 and 50 per cent during the next decade.
Despite the flooding coming at the potato harvest time, the British
Potato Council yesterday insisted it was business as usual and said that
prices were actually lower than at this time last year.
"There is no present shortage of supply of potatoes. The flooding,
whilst causing severe losses for some individual growers, has not
impacted on GB supply, as yet, to any significant degree," a spokesman said.
However, she said the full picture about the 2007 crop will not be clear
until September or October.