Fruit prices to rise due to floods

WITH all early signs indicating that 2011 will be a tough year financially, you may end up asking yourself why just days ago you were celebrating the new year.

Record-breaking floods in Queensland are not just causing heartache for those caught up in the devastation; the flow-on effect will cause headaches for consumers all around the country.

Some analysts are predicting fruit and vegetable prices to rise by up to 50 per cent because of the devastation of Queensland crops.

The Australian Food and Grocery Council (AFGC) is Australia's leading national organisation representing Australia's packaged food, drink and grocery-product manufacturers.

AFGC chief executive Kate Carnell said the main food commodity likely to affect Clarence Valley residents was fruit and vegetables, particularly vegetables.

She said increases in vegetable prices could be felt as early as two weeks from now and prices could stay high for quite some time.

“There will be a significant effect on vegetables, particularly salad vegetables (and) those increases could be quite substantial,” Ms Carnell said.

“In the short term, the supply problem can be made up by trucking things in from other parts of Australia.

“But once you have the problem of the quite significant amount of these vegetables being taken out of the market because of the Queensland crop losses, then we'll start seeing more generalised price rises right across Australia

“And there's going to be an effect on salad vegetables, vegetables generally and some fruits; and they could be quite significant increases.”

Ms Carnell said it was unclear when Queensland farmers would be in a position to start planting again, but it may not be until the less-productive cooler months later in the year.

Queensland beef is another product likely to skyrocket in price because of flooding, but a local stock and station agent said the Valley didn't rely on the supply of Queensland beef for local markets.

Peter McCrohon from Farrell McCrohon said most beef sold in the Clarence Valley came from local producers, not Queensland.

Mr McCrohon did say, however, that local beef farmers had their own problems trying to contend with the heavy rains that had fallen on Northern NSW in 2010.

He said limited local supply had been a problem for some time now, and that was responsible for keeping prices high.

“Our biggest hope now is that it doesn't flood in February,” he said. “If it doesn't flood, it'll be one of the few places that hasn't.”

And to ensure grocery prices are not singled out, electricity prices are set to rise again.

In 2010, the Independent Pricing and Regulatory Tribunal (IPART) approved an average increase of 13 per cent for Country Energy customers, 10 per cent for Energy Australia customers and seven per cent for Integral Energy customers.

Between now and 2013, electricity prices are expected to increase another 12-17 per cent.

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