ADM Milling is to put up its prices on all flours by £21.25 a tonne from January 15.

The rise in price is in response to higher wheat costs, ADM Milling’s MD Ian Pinner told British Baker.

He commented: "Since August 2006 UK bread wheat prices have gone up by a further 15%. We have been absorbing these costs but cannot continue to do this, especially with there being no outlook for wheat price deflation in the immediate future."

Meanwhile, rival miller Rank Hovis said the cost of wheat was extremely strong and if that strength continued, a price rise was "almost inevitable".

ADM Milling’s price rise announcement was forecast in British Baker last month (November 10, pg 4). It comes after ADM put up flour prices by £28.75 a tonne in September and rival Rank Hovis by £29 a tonne. That is equivalent to around 2-3p on the cost of every 800g loaf.

City analyst David Lang commented: "The question is who pays? The big companies are locked into contracts with the millers, so it is the smaller bakers who are exposed."