Tesco’s decision to remove Marmite and other top brands from its stores may be only the start, it has been claimed.

The row between Tesco and grocery giant Unilever shows how Brexit could lead to higher food prices for British consumers, said MP Steve McCabe (Lab Birmingham Selly Oak).

It’s a result of the British Pound Sterling currency falling in value after the Brexit vote.

A weak Pound means goods imported into the UK effectively become more expensive. Shops then have a choice between accepting a cut in their profits or passing the extra cost on to the public by putting up prices.

Tesco has responded to Unilever’s attempt to put up prices by 10 per cent by simply refuding to restock its products. They range from Marmite and Hellman’s, to Flora, Domestos and Surf.

But in the long run, the price of imported food and other household products will increase unless the value of the Pound is stabilised, said Mr McCabe.

The MP said: “What we are seeing now is an early skirmish between a supermarket and a supplier.

“It shows that the instability of the pound will eventually lead to higher food prices.

“There is a squabble over who pays the bill, but ultimately the bill will be imposed on the public."

MP Steve McCabe wanred food prices may rise
MP Steve McCabe wanred food prices may rise

Mr McCabe added: “The Government’s got to come forward and give some explanations as to what it’s doing to identify and offset this problem.

“If they don’t then instead of having £350 million a week extra to spend on the NHS, as the ‘leave’ campaigners claimed, we’ll be stumping up £350 million extra a week to pay our food bills.”

A Tesco spokesperson said: “We are currently experiencing availability issues on a number of Unilever products. We hope to have this issue resolved soon.”

Other big supermarkets - including Asda and Sainsbury’s - appear to be stocking all 42 Unilever brands as normal.

Watch: MPs discuss the Marmite situation

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In theory, a weaker Pound could benefit UK firms which export products, because it effectively makes British goods cheaper in overseas markets. However, any firms which buy supplies or services from foreign firms as part of the manufacturing process will also see their costs increase.

It is thought a number of supermarkets are embroiled in the row with Unilever, which earlier this year posted profits of around £2 billion for the first half of 2016.

Unilever refused to comment on the dispute, but chief executive Paul Polman warned in June that a vote to leave the EU’s single market would increase prices for consumers.

He told Channel 4 that a vote to Leave would mean hikes in import duties on items such as dairy products, leading to price rises that would affect consumers.

Citing the example of Wall’s Magnum ice cream, Mr Polman warned about trade restrictions, saying: “Undoubtedly if the UK were to Leave, the conditions will not be as good as if they stay in.”