Food Price Rise UK
© Sean Smith/Guardian News & Med
Gloom: Waitrose boss Mark Price warned that food prices are likely to rise even further in the coming years.
Massive rises in food prices will hammer family budgets this year, the boss of one of Britain's biggest supermarkets warned yesterday.

Waitrose managing director Mark Price said recent increases in the price of bread and vegetables were 'just the tip of the iceberg', with prices set to rise across the board.

'Everything will be hit,' he added.

And with farmers facing poor harvests after the second wettest year on record, Britain's impending food crisis looks set to last 'for the foreseeable future'.

Another punishing rise in the cost of the weekly shop - which is already increasing faster than wages - will hit families struggling to make ends meet. Living standards are already under their greatest squeeze in a generation, compounded before Christmas when energy providers announced inflation-busting price increases.

Now food prices are likely to carry on rising after crops were hampered by appalling weather. Mr Price said: 'We're seeing input food inflation of around 3 to 3.5 per cent, but we expect it go up to as much as five.

'But you can't ever say how high these increases will end up being. The one safe thing to say is that demand will out-strip supply. It is likely that food inflation will continue to rise for the foreseeable future. In some commodities, the increases will be massive. It's bread, vegetables, all produce.

© Reuters
A car is towed from flood water in Milby, north Yorkshire, in December.
'The apple crop was down 20 to 30 per cent so apple prices have to go up. You have only seen the tip of the iceberg. It is impossible to say how long it will last.'

The pain from last year's poor crops will be felt for the next two years, he added.

While crops such as apples and vegetables will be felt immediately, meat prices take longer to be affected. The rising costs of animal feed will still be felt in two years, because cows take 22 months to rear.

Food inflation is currently at around 3 per cent but could rise to as high as 6 per cent

Food price inflation was 4.6 per cent in November, according to the British Retail Consortium. December's figure, to be published next week, is expected to be the same. An increase of the level predicted by Mr Price could push this figure up to more than 6 per cent.

Experts have already warned that last year's catastrophic US drought would force punishing food price rises onto families.

Over the summer more than 35 states declared disaster areas because of the extreme conditions, which left crops decimated and vast swathes of land uninhabitable.

In the UK, sodden conditions and poor sunlight left farmers facing delayed harvests.
Farmers have already warned that heavy rain in recent months means many have not yet planted crops for this year.

Even own-label budget items in supermarkets are rising sharply, after it was revealed last month that grocers were hiking prices on their branded goods.
Trolley with Groceries
© Alamy
Food inflation is currently at around 3 per cent but could rise to as high as 6 per cent.
Supermarkets slapped a mark-up of up to a fifth on more than 40 per cent of budget items, research from online comparison site Moneysupermarket showed. The move hits shoppers who try to save money by downgrading to cheaper ranges. Consumer groups last night called on supermarkets to simplify price structures to help families choose the best deal.

Which? executive director Richard Lloyd said: 'Household budgets are under enormous strain and our research has shown rising food prices are a top concern.

'More people are shopping at discount supermarkets and one in four say they are planning to cut food spending in the next few months.

'We want retailers to make food pricing much less confusing so real bargains can be spotted at a glance, and to offer responsible price promotions that give consumers the best possible value for money.'

The latest figures show average wages are just 1.8 per cent higher than a year ago - well below inflation of 2.7 per cent. Inflation has been above the Bank of England's 2 per cent target for three years and continues to outstrip pay rises for the majority of workers while at the same time eroding the nest-eggs of savers reeling from record low interest rates.

It was hoped that 2013 would finally see pay rise faster than prices - with average earnings going up 3.1 per cent and inflation falling to 1.9 per cent.

But in the autumn statement last month, the Office for Budget Responsibility said it expected inflation of 2.5 per cent this year compared with wage growth of just 2.2 per cent.