The sun is shinning but not on Europe's farmers.

The price of milk, cheese, chicken, beef and pork and derivative products are all expected to rise because the industry has been hit by soaring animal feed prices, a shortage of silage and poor harvests.

BOCM Pauls, Britain's biggest animal feed supplier, has reported a 20 per cent increase in the price of raw material feed on last year

The cost of wheat used as animal feed has also jumped by 30 per cent.

Farmers are already grumbling and things are going to get worse.

The company warned that the price at which it sells feed to dairy, poultry, beef and pig farmers would have to increase by 20% over the next three months, but it is questionable whether such increases can be pushed through. The consumers are likely to be sheltered in part with producers taking the brunt but it might bruise the retailer’s margins as well.

Farmers and food producers can look to import to offset domestic problems, however, traditional sources such as Russia and Poland are suffering similar concerns. A drought affecting a third of Russia's crop zone is expected to halve exports. Poland has seen the worst flooding in recent memory.

 

This is another unwelcome inflationary aspect leading to fears that food price inflation might be a major contributor to a possible double dip in not just the UK but other European countries

Enjoy the sun shine but remember we need steady rain in the next 8 weeks if some of the yield losses are to be recovered.

The sun is shining but not on the farmers.