Australian retailers have been warned that blaming the drought for increased prices could lead to heavy fines.

Agriculture Minister Warren Truss said he was alarmed by claims that the drought had forced up the cost of staples such as bread and milk.

Truss said the cost of most household basics should not yet be affected by the drought and retailers who increased prices were exploiting people’s sympathy for farmers: “Everybody would feel that it is completely unacceptable for people to capitalise on this desperate situation.”

Legislation is being proposed that would mean that any retailers found guilty of drought-related profiteering would face a fine, reported the Sunday Mail.