Food Costs Could Crimp Global Growth

Another way manufacturers may pass on the price increases to consumers is in reducing the size of the packages of their products, many say. The rise in prices of sugar and corn may also force companies such as Coca-Cola (KO Quote) and Pepsi (PEP Quote) to lift prices in soft drinks and snacks.

Conversely, big food retailers such as Wal-Mart Stores (WMT Quote), Kroger (KR Quote), Costco (COST Quote) and Albertsons have been winners in the past year. Their ability to weather decreased margins vs. smaller traditional retailers while still keeping costs low gives them increasing prominence in the food retail market, writes Ephraim Leibtag, an analyst from the U.S. Department of Agriculture, in a December research report.

In clean fuels, next year the EU has stipulated that 6% of all diesel fuel produced in Europe must be biodiesel, as opposed to the current level of 2%. The demand for biodiesel has seen a rush in public listings of biodiesel producers on London's Alternative Investment Market, as well as hefty returns for shareholders. But such policy is putting pressure on countries that supply the vegetable components used to make the clean fuel.

The Philippines has voiced concern recently that it will be unable to meet demand for copra, a substance produced from coconuts that is used in the fuel. Such supply shortages would also put more pressure on food prices.