Nick Higgins, commodity analyst at Rabobank, said the impact of the weather on corn and soya bean crops is much worse than five years ago but so far traders have not pushed up prices as dramatically. "The speculatively driven highs reached in the wheat crop during that period may not be reached but, in terms of damage to the actual crops, it's worse," Higgins said.

On Wednesday, the US agriculture secretary pushed corn prices even higher when he said the situation was not bad enough to warrant a reduction in government quotas for biofuels, specifically ethanol, which is typically made from corn and is a factor in keeping prices high.

Ruth Kelly, Oxfam's food policy adviser, said: "The toxic combination of a heatwave in the US, which is decimating corn harvests, and the unwavering global demand for biofuels, is again pushing the price of basic food stuffs higher and higher."

Comments: Be the first to add a comment

add a comment | go to forum thread