Cheaper food commodities prompt calls for retail price cuts

(Reuters) - Prices of many food commodities have been falling in recent months but in many countries food inflation has remained stubbornly high, prompting calls for retail prices to be cut.

France's finance minister Bruno Le Maire said on Friday he had secured a pledge from 75 top food companies to cut prices on hundreds of products.

The United Nations food agency reported earlier this month that its world food price index fell in May to its lowest level in two years driven by a slump in prices for vegetable oils, cereals and dairy.

Huge harvests of crops such as soybeans in Brazil have helped to drive down prices with supplies of many crops becoming more plentiful while global economic woes have also exerted downward pressure on commodity prices.

The price of food ingredients such as wheat or soybean oil, however, is just one element in the cost of producing and selling food.

Food processing and packaging also plays a major role and can be impacted by factors such as higher wages as workers demand pay rises to compensate for inflation. Higher labour costs can make operating more expensive for both wholesalers and retailers of food.

(Reporting by Nigel Hunt, Graphic by Vincent Flasseur;Editing by Elaine Hardcastle)