The well-known producer of flour and oat-based products, Odlums, has warned that prices for its products will go up due to increases in new crop wheat prices as demand increases.
The company said that with the global harvest season well under way, it is already clear that prices world-wide for the 2007 crop will be significantly higher than for the previous year.
'Shoppers will be hit by these prices as wheat crops will increase in price by at least 30%', it said in a statement.
'This comes at a time when demand continues to grow and global stocks of wheat are at their lowest level since the 1960's, falling from 125m tonnes to a current level of 111m tonnes', it said.
Odlums said it will aim to keep prices to a minimum, but added that it has indicated that flour prices will increase over €90.00 a tonne.
It said that the UN has highlighted the growth in global population alongside growing wealth, as factors which will result in increased demand for grain.
In the US, a lot of land was taken out of wheat production and diverted into producting biofuel, and though development is at an earlier stage in the EU, it is expected new factories will come on stream over the next two to three years in order to hit the requirement of 5% transport fuel from renewable sources.
Also a dry April followed by wet weather in June and July in western Europe, has given rise to concerns about both the size and quality of the wheat harvest in France, Germany and the UK.
Earlier this month Irish food group Origin Enterprises paid €35m to acquire the 50% shareholding of Odlums that Greencore owned.
