Grocery prices expected to climb by 20 percent as shops pass on cost of war

A fresh and devastating blow is heading for struggling households with the price of food expected to spike even further in coming weeks.

Retailers are now having to pass on the massive costs they've been absorbing, in the weeks since the Middle East war began. 

Fresh everyday food staples are about to cost more as a result of the fuel crisis.

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Independent supermarket Ritchies is among those sounding the alarm.

Meat, fruit and vegetables are all expected to cost 20 per cent more and in as little as three weeks.

NSW Farmers bosses say members are being hit.

"Particularly the ones that have further to travel like onions and lemons which are already incurring a $1 per kilometre additional transport levy for those trucks bringing that produce to the distribution centres to get to consumers at the supermarkets," Xavier Martin, NSW farmers president said.

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The price of home brand milk is also expected to climb, with dairy farmers asking supermarkets to increase prices by 30 cents per litre as processors pay through the nose to combat high diesel and fertiliser shortages.

As for everything else, retailers have been absorbing exploding transport costs but now need to pass that onto shoppers.

Some economists say a 20 per cent price hike for fresh food is just the beginning with even further increases anticipated unless the war in the Middle East ends.

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"Even if it ended today where has been impacts on supply chains that will be with us for weeks and months ahead," Energy Minster Chris Bowen said.

New data from the UN says global wheat prices have already risen by 4.3 per cent last month, with farmers planting less because of the challenges they are facing.

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