However much you hope that the food crisis will go away, it's difficult to ignore this week's headlines warning us that the era of cheap food is over. But which of the staples in our shopping basket will be worst hit?
The general picture is that most items will go up, some more significantly than others. With oil at $117 a barrel and rising, so are the costs rising of the three Fs of farming: feed, fuel and fertiliser. “We're in a unique situation in which numerous problems are coming together,” says Tim Lang, Professor of Food Policy at City University. We're not just facing rising oil prices and water shortages, but the changing dietary habits of the developing world as it becomes richer, combined with land being used to provide crops for fuel rather than food, and climate change bringing drought to countries such as Australia.
There's no doubt that we're going to have to spend more on food. And yet, compared to other parts of the world, we're lucky. We spend 13 per cent of our household budget on food, down from 30 per cent, 50 years ago. For a family in the developing world, food is likely to be between 50 and 75 per cent of the total, according to the World Bank. What's more, in poorer countries, people buy raw ingredients, so if the price of corn doubles, that seriously affects their buying power.
But there is another side. Not only is the EU already backing down on biofuels, but some economists argue that the price of raw materials will be regulated by market forces. The theory is this: if farmers respond by growing more staple crops and leaving less land fallow, production will increase, thus lowering prices.
Meanwhile, supermarkets will compete to keep prices low. This could have ethical repercussions, cautions Evan Fraser, a senior lecturer in sustainable development at Leeds University. “Consumer instinct is to want to keep food cheap,” he says. “But usually this is achieved by squeezing producers.”
Here we show you what the food is your basket might cost in ten years' time.
CHICKEN
There is likely to be a significant price increase in the traditional centrepiece of the Sunday roast. Chicken, as a 100 per cent grain-fed animal, is at the mercy of soaring grain prices, which have increased 50 per cent in the past six months. The rise is in response to factors such as drought in Australia, the rise in affluence encouraging increasing numbers of consumers in the developing world to eat meat, and crops being grown for biofuels rather than food. As 60 per cent of the cost of a chicken is its feed, grain will have a significant impact on what we pay.
BEEF
The United Nations estimates that it takes an average of 8kg of grain to produce 1kg of beef. As most British beef is fed on pastures during the summer, beef might avoid the worst of rising grain prices, which have doubled in the past year. “Stick with British grass-fed beef and you're making a green choice as well as one that might remain immune to grain prices,” says Evan Fraser, a sustainablility expert at Leeds University. Beef from the United States is likely to be worse hit since it is intensively reared on large quantities of feed.
GM TINNED TOMATOES
Rising food prices may make genetically-modified food more popular. “Until now there has been the sense that we can do without GM methods,” says Giles Oldroyd, of the John Innes Centre. “But with rising food prices, we will appreciate that if this is a way to increase yields and keep prices down, it is worth pursuing.” Drought and insect-resistant crops are being developed that have the potential to combat climate problems in the developing world.
COFFEE
Coffee reserves are at their lowest point since records began, so prepare to fork out more for your morning latte. The first and biggest impact of countries such as China and India growing richer is a switch from a starch-based diet to a meat-based one. Next will be a sharp rise in demand for coffee and chocolate, increasing competition for the global supply. In Vietnam, for example, coffee consumption has risen 200 per cent over the past few years.
APPLES
Once oil becomes scarce, fuel prices will rise significantly and shipping fruit across the world will become less financially viable, encouraging us to eat locally grown produce. Exactly when this will happen is hotly disputed. The oil industry says that peak oil prices may be 30 years away, but some oil experts argue that we've reached them already. Until oil becomes considerably scarcer, it may continue to be as cheap to buy an apple from New Zealand as one from Somerset.
WINE
It is tax that affects the cost of wine, far more than anything to do with the raw ingredients. Even a series of bad grape harvests would have little impact on overall prices. When you buy a bottle of wine, £2.47 is tax, the remaining amount covers the bottling and transportation,as well as ingredients. However, some market analysts believe that thanks to global warming, we may be drinking Yorkshire wine by 2018.
MILK
While this may come as good news to dairy farmers, consumers can expect to be paying more for their pints. Already in the past 12 months prices have risen 20p, again owing to the increased cost of cow feed. In the past decade supermarkets have pushed down the price of milk, which has resulted in an exodus of farmers from the UK dairy industry. So, as less milk is being produced, prices inevitably go up.
EGGS
In the past nine months the price of eggs has increased by 34 per cent in the UK, as they are equally dependent on rising grain prices as chicken feed. The pattern will continue, according to Giles Oldroyd, at the John Innes Centre. He claims that the practice of intensively rearing chickens will continue, but that the days of the £2 chicken are over.
READYMEALS
According to Mintel research, the growth of the readymeals market has slowed over the past few years, due to growing health concerns. This is expected to continue. However, processed foods will have an easier time avoiding price increases. “What you're paying for is mostly packaging, transport, marketing, freezing and other things,” says Fraser. “The raw ingredients are only a fraction of the overall cost.” If they go up, the increase can be absorbed by cutting costs in other stages of the supply chain.
BREAD
The price of your daily loaf will rise, but not as dramatically as you might expect. Global wheat prices have doubled in the past year, but wheat accounts for only 13 per cent of the cost of bread. The rest of the cost is other ingredients (about 20 per cent): packaging, advertising and transportation. Leading retailers who know that it is important to control the price of staples will work hard to absorb higher bread production costs, even if it means squeezing producers.
RICE
Expect to be eating less of this basic foodstuff, says Evan Fraser, of Leeds University. Blame a decline in global exports - global supplies have been outstripping demand for the past few year - which is already under way. The rice-producing countries in Asia, worried that prices will rise and keen to keep their supplies to feed their own population, are clamping down on the amount that they export. Already India exports only basmati rice and Vietnam is cutting back its rice exports.
VEGETABLES
Compared with meat and other grain-related foodstuffs, vegetables may seem relatively inexpensive, says Peter Ayton, of the market analyst Mintel. Research indicates that sales of fruit and veg have been star performers, growing steadily over the past few years. Mintel predicts that this will continue, due as much to our interest in healthy eating as reasonably stable prices. In the longer term, rising oil prices combined with water shortages are likely to increase costs. Most vegetable production needs nitrogen fertiliser, which is energy-intensive, and plenty of water.
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