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Nestle's Brabeck Says Food Prices Set for 'Long-Lasting' Inflation: FT

AFX
Friday, 6 Jul 2007 | 3:13 AM ET

Food prices around the world are set for a "significant and long-lasting" period of inflation because of a variety of factors, including demand from China and India, Nestle's chairman Peter Brabeck said in an interview with the Financial Times today.

The use of crops for biofuels and general population growth would also continue pushing food prices higher, Brabeck said, while on a trip to China.

"They will have a long-lasting impact on food prices," Brabeck told the business daily, referring to long-term and structural factors affecting prices.

He also cited rising demand from "the phenomena of India and China" as leading to higher food prices.

According to the FT, corn prices have risen about 60% in the past year, and wheat prices have gained about 50% in that time, while sugar, milk and cocoa prices have also increased.

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