Yeast producer and supplier Lallemand GB has announced it will be increasing its prices by up to 16% in the British Isles from January 2012, or as existing contracts expire.

The Felixstowe-based business, part of the privately held Canadian Lallemand Inc group, said the would be dependent on product, quantity and terms.

Mike Chell, managing director at Lallemand GB, said: “The costs of key raw materials and electricity, gas and fuel, the main contributors to the production cost of yeast have risen significantly over the past year.

“The increased costs have already eroded the margins to below the minimum required to justify further necessary investments to guarantee product quality and service levels.

"Although we continue to seek to compensate such cost pressures by improving productivity, there is a limit to what we are able to sustain without increasing our prices.”