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Food prices rising at highest rate for 14 years

London Telegraph | December 11, 2007
Harry Wallop

Food prices are accelerating at their highest rate for 14 years - and running at more than three times the rate of inflation, official figures show.

Increasing wheat and dairy prices mean food factories are having to pay 6.6 per cent more for their raw ingredients than a year ago - the highest annual rise since 1993, according to the Office for National Statistics (ONS).

These increases will inevitably be passed to consumers, and economists warned that families would have to face even higher prices next year while having to cope with other rising living costs as the credit crisis starts to bite.

(Article Continues Below)

Ruth Lea, a leading economist and adviser to the Arbuthnot banking group, said: "All sorts of things are hitting people next year, from higher mortgage payments - despite last week's cut - to council taxes, which are likely to be much higher. Then look what is happening at the petrol pumps.

"Now you have pressure on food prices. They are all conspiring to undermine people's disposable income."

The data from the ONS came as separate figures showed milk prices hitting their highest level for 11 years.

The statistics, from the Department for the Environment, Food and Rural Affairs, showed that farmers received 26.53p a litre for their milk in October - a 51 per cent increase over the last six months.

Full article here.

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