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Rising cost of breakfast: blame Ukraine

Tuesday, Mar 25, 2014 - 02:10

Mar 25 - The cost of breakfast is on the rise. As Ivor Bennet reports it's thanks to the crisis in Ukraine, unusual weather and disease.

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For some, it's the perfect way to start the day. A trip to a greasy spoon and one of Britain's famous fry-ups. But it could soon leave customers with a bitter taste - a combination of drought, disease and geopolitics pushing up the bill. SOUNDBITE (English) IVOR BENNETT, REUTERS REPORTER, SAYING: "The Full English please...The crisis in Crimea and the weather in Brazil may seem like a world away from this London cafe. But the events are set to have a big impact on the price of what's on our plate." The unrest in Ukraine has seen wheat prices rise by 12 percent. Russia's incursion in Crimea causing concern over grain shipments from Europe's bread basket. The increase is nothing though compared to coffee - the price of arabica beans soaring over 70 percent so far this year. A prolonged dry spell in Brazil is fuelling fears of a poor harvest. Even though last year saw a bumper harvest, Nicholas Brooks from ETF Securities says it's not enough to stop prices soaring. The same worry's also boosted the price of orange juice, and sugar too. SOUNDBITE (English) NICHOLAS BROOKS, HEAD OF RESEARCH, ETF SECURITIES, SAYING: "Prices have been very low across the grains. As I mentioned, arabica prices at seven-year lows because it was known there were substantial stocks because, we had two years in grain for example bumper crops, but as the situation changes markets react very quickly and that's what they've been doing." Pork is another commodity on the rise. The price of lean hog surging 40 percent after a virus in the US market dented pig numbers. While this increase is already being felt by consumers, others will take longer to filter through. SOUNDBITE (English) NICHOLAS BROOKS, HEAD OF RESEARCH, ETF SECURITIES, SAYING: "The cost of the coffee bean as a proportion of your latte is still very small. so it's very unlikely that the increase in the arabica prices that we've been seeing recently will be directly reflected in a higher cost in your morning coffee." I paid just over 6 pounds for my breakfast. Not as cheap as it would've been last year may be, but no less delicious.

Rising cost of breakfast: blame Ukraine

Tuesday, Mar 25, 2014 - 02:10

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