Government subsidising of biofuels has contributed to rocketing food prices, according to Dave Brooks, chief executive of cake group Finsbury Foods.

Brooks predicted the next 12 months would remain "extremely challenging" for the food industry with commodity costs remaining high and he claimed the government was exacerbating the problem by subsidising farmers to grow biofuel crops in favour of wheat.

Finsbury posted like-for-like sales up 91% to £82.7m in the six months to December 2007 with pre-tax profit up 95% to £2.61m.

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