THE price of Hovis bread looks likely to rise after RHM told consumers yesterday that they would again have to bear the brunt of higher wheat prices.

The foods group, which also makes Bisto gravy and Sharwood’s sauces, said that the price of its bread loaves would need to reflect the 25 per cent surge in wheat prices since the middle of September. The price of wheat has risen as poor harvests in a number of producer countries put pressure on supplies.

RHM said that the price increase would reduce its first-half profits by £2 million. The full-year cost would, it said, depend on any further change in wheat prices and the timing of the company’s bread price increases. The warning comes a month after RHM admitted that turnover and margins in its culinary brands unit, which includes Bisto and Sharwood’s, had been affected by the hot summer, which resulted in consumers avoiding roast dinners and curries.

Andrew Allner, RHM’s finance director, said yesterday that world wheat stocks remained very low and the current level of supply could have a dramatic impact on wheat prices.

This week Cadbury Schweppes complained that profits would be hit by an increase in soft commodity prices.

Shares in RHM closed up ½p at 271¾p on the update, which provided reassurance after a more cautious outlook in late September.

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