World leaders today sent out a desperate last-ditch plea to their negotiators to end the deadlock in the long-stalled trade talks and do a deal later this month that would bring down the price of food.

On the day British shoppers were told that the cost of food is rising at the fastest rate for 18 months, Gordon Brown said that the nation's households would benefit by an average of £200 a month from cheaper food bills if the Americans, the European Union, Latin America and South Africa could settle their differences at a meeting in Geneva on July 21.

The Prime Minister used the last few hours of the Group of Eight summit meeting in Japan to conduct an intensive round of trade diplomacy, meeting with the leaders of the US, China and, crucially, the President of Brazil, Luis Inácio Lula da Silva.

President Lula's insistence on maintaining tariffs on industrial goods had appeared to be an insuperable obstacle to a deal, but Mr Brown struck a surprisingly optimistic tone about the prospects of success.

He said that Mr Lula had made clear that he wanted a deal and would work to achieve it. He also reported that President Nicolas Sarkozy of France, who has been reluctant to reduce European agricultural tariffs, was also working hard to bring about an agreement.

According to officials at the summit, the leaders will now tell their negotiators to do all they can to reach a deal in Geneva.

“We are at a minute to midnight in the trade negotiations,” said Mr Brown. “If we fail this month it will not be easy to resume negotiations for the next few months or even the next year. Everyone who has talked about trade has dismissed the idea that we could get a deal. I have been an optimist on this but everyone knows that the Latin American position has hardened. But President Lula and every other major player has shown a willingness to get round the table and try to come to a deal.”

He went on: “I believe President Lula is making possible a resumption of negotiations and given hope that what has eluded us for months is now possible within the next few days.”

British households will certainly hope so. Today's figures from the British Retail Consortium reveal that food prices rose by seven per cent in June, an unwelcome burden with clothing, footwear and electricals also up and inflation expected to rise from 3.3 per cent.

The meeting of the World Trade Organisation in Geneva is generally acknowledged to be the last chance of a deal this year. If it fails, the American presidential election will make it impossible to resume serious negotiations until a new US administration has settled in, several months into 2009. Officials said that throughout the summit Mr Bush has been urging the other leaders to reach a deal during the remaining four months of his presidency.

The United States and the EU want large developing countries such as Brazil to make deeper cuts on import tariffs for industrial goods in return for reductions in their own agricultural subsidies and tariffs.

The Doha round was launched in 2001 with the goal of boosting the global economy and helping poor countries export more. But the negotiators have missed one deadline after another because of disagreements on farm subsidies, import tariffs and market liberalisation.

The G8 leaders hope that the political impetus of their meeting will be the spur to overcoming the massive differences over bringing down American and EU farm tariffs and industrial tariffs in Latin America.

Mr Brown and Mr Lula issued a joint statement, setting out their determination of all countries to close their trade differences. It said that the window of opportunity for achieving a deal was “small and is closing” and that at a time of global uncertainty and high food prices “we must open markets and boost trade, rather than resorting to protectionism”.

It added: “The time for technical negotiations is drawing to an end. The key decisions now are political ones. We must act decisively now. If we don't we will be failing the world's poor and destroying the best basis for continued economic growth. The cost of failure is simply too great.”

Times Recommends

• Heed the great stabiliser’s words
• How a voice for everyone led to stalemate
• Bakara market becomes a slaughterhouse