Australia-Decline in food prices expeceted.

AUSTRALIA-Australian Food Prices Likely Flat To Lower In 2009-Rabobank

Retail prices for many foods in Australia likely will stall or fall in 2009 as the forces that drove recent increases start to unwind, Rabobank Australia’s senior food analyst Tim Hunt said late Wednesday. Agricultural commodity costs have fallen, plastic pricing has started to ease and distribution costs will fall in line with fuel prices, he said. Weak demand conditions will also encourage retailers and processors to reduce prices to keep product moving and while a weaker Australian dollar will increase the cost of imported food, this is likely to be more than offset by these other factors, he said.