The French government has played down the prospect of a significant increase in bread prices due to the rising cost of wheat, despite warnings from bakery industry quarters.

Speaking on French radio, French Economic Affairs Minister Christine Lagarde said she was not expecting a major rise in price, claming that flour only accounted for 5% of the cost price of bread.

Lagarde added that consumer associations' forecast of an 8% increase was an overstatement and insisted that government officers are "on alert" to ensure that no unjustified price rises are implemented.

The minister's analysis contrasts sharply with that of France's bakery federation, the FEBPF, which highlighted the possibility of consumers paying up to 17-18% more for bread products such as baguettes as a consequence of the wheat hike.

However, the FEBPF admits that price rises will ultimately depend on negotiations with the supermarket groups, the biggest customers of industrial bakers.