Life is sweet for Nestlé as old favourites drive sales

The worst US drought in more than half a century has pushed up grain prices sharply.

The United Nations food agency said yesterday that world food prices surged in July and could rise further.

Nestlé said it expected price rises for its ingredients of only in the low to mid-single digits for the rest of the year, in line with its earlier forecasts and keeping it on track for its target of underlying sales growth of 5-6 per cent this year.

While cocoa prices are surging, coffee prices are well below two-year highs on expectations of a good harvest in top producer Brazil. Sugar prices are also down.