3 Feb 2011

Don't take high prices for granted, food producers warned

6:55 am on 3 February 2011

An agribusiness commentator warns that now is not the time for food producers and exporters to sit still while they ride high commodity prices.

Wool, meat and dairy prices are at record highs due to global demand and a tight supply of food commodities.

Ian Proudfoot, head of agribusiness at accountancy firm KPMG, says the prices are not sustainable at that level because they are going up without producers having to do anything.

Natural disasters such as floods in Australia and fires in Russa have curtailed supply, creating an increasing demand, but if supply comes back on tap, prices will go down again.

Mr Proudfoot says it is important that producers continue to work on improving their supply and positioning in the marketplace.