Wednesday, January 26, 2011

Food price rise may be lasting-Nestle chairman

FRANKFURT:'' A "worrisome" rise in world food prices may be long-lived, the chairman of Nestle, the world's biggest food group, told a German newspaper.

"The financial and economic crisis in 2008 put an abrupt end to price rises. I am afraid that this time the rise could be lasting," Peter Brabeck told the Frankfurter Allgemeine Zeitung in an interview released on the paper's Internet site ahead of publication on Wednesday, Jan 26.

Brabeck said it was "madness" to turn agricultural areas over to the production of biodiesel, even if targets for production of the fuel had been trimmed.

Food prices, which shot to record highs in December, have also moved to the top of the global policy agenda.

"No food for fuel" was one answer to the food inflation problem, Brabeck said. A second was greater investment in agricultural production.

"With current techniques, including gene TECHNOLOGY [], one could feed up to 9.5 billion people," Brabeck said.

Brabeck also lashed out at "arbitrary political decisions," such as export bans on wheat or sugar, that hampered the free market.

Surging agricultural prices have been brightening prospects for companies active in the sector, such as German potash miner K+S, plant breeder KWS SAAT, chemicals maker Bayer and Swiss crop protection and seed maker Syngenta. - Reuters


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