Source:
Times OnlineThe surge in the price of food will continue for at least a further two years, the chief executive of one of the world's biggest food companies has told The Times.
Indra Nooyi, the joint chairman and chief executive of PespiCo, predicted that “structural inflation for food is here to stay for another two to three years”, and that it would be propelled by government initiatives to subsidise ethanol programmes, the biofuel that is seen as a more environmentally friendly alternative to oil.
Over the past 12 months milk prices have doubled as demand for corn, the staple diet of a dairy herd, increased substantially. Corn is also used in the fermenting process to produce ethanol. The cost of a bushel of corn doubled over the same period.
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Ms Nooyi is not the only senior business figure to predict that high food prices were here to stay. Carl Weinberg, co-founder of High Frequency Economics, a think-tank, predicted that continuing food-price inflation, along with an expected slowdown in China, presented one of the biggest downside risks to the American economy.
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http://business.timesonline.co.uk/tol/business/economics/article3221937.ece