Scottish ingredients supplier Macphie of Glenbervie has predicted a tough road ahead despite record profits last year.
The company’s pre-tax profit for 2007 was up 12% to £3.8m and sales increased by 2%, according to accounts lodged with Companies House. However, chief executive, Alastair Macphie, forecast a much less cheerful 2008.
He said: "A spate of poor harvests and changing global demand for commodities means that raw material costs have soared to a record high and this is hitting the food industry."
These pressures looked set to continue industry wide, he said. "Production volumes have grown but selling price deflation in certain sectors remains a key feature of the market."