June 18, 2008

New Zealand could face more food price increases as grain prices hit record high, the Federated Farmers warned on Tuesday (June 17, 2008).

Prices of fuel and fertilisers have increased sharply and that will contribute to the price increases for eggs, poultry and pork, according to the Grain and Feed Council chairman Andrew Gillanders.

Gillanders said the Midwest floods in the US and biofuels have made matters worse.

Most poultry farmers have hedged against this year's high prices but grain prices are expected to escalate by 60 percent next year, Gillanders said.

Executive director Michael Brooks said the costs have driven up egg prices by 10 percent in a year and chicken prices by 8 percent in six months.

However, that will not be the end of the story as Brooks expect a further rise in prices.