Danish consumers could face an increase in the shop prices of meats, baked breads, breakfast cereals and confectionery products in the autumn, Food and Agriculture Minister Hans Chr. Schmidt has warned.

The Danish government is under pressure from consumer groups to reduce VAT on foodstuffs. However, Schmidt said that while a fresh look at VAT rates on food is planned, the government would not make any promises.

"We are looking at a domestic foods situation which is being adversely largely affected by external matters. The heavy sustained rainfall in May and June has reduced home crop yields. World demand for grains is pushing prices up. This will most likely be reflected on shelf prices in the autumn," said Schmidt.      

The foods industry claims that it has little option but to pass on the additional external costs to Danish consumers.