Food prices jump in January on higher fruit and veg costs

Food prices jump in January on higher fruit and veg costs

By Jason Krupp

Feb. 11 (BusinessDesk) - New Zealand's food prices rose in January after two months of declines, led by a spike in fruit and vegetable costs.

Food prices rose 1.8% in January, following price declines of 0.8% and 0.6% in the previous two months, according to the latest numbers from Statistics New Zealand. The largest contribution came from fruit prices, which rose 7.7%, and vegetable prices, which increased 7.2%, while grocery food prices increased 0.9%. Food prices rose 3.8% in the year to Jan. 31.

"The fruit and vegetables subgroup was the key upward contributor, accounting for half the 1.8% increase in food prices," the department said. "This subgroup had three times the impact of grocery food, the next largest contributor."

The release captures the first indication of prices after the release of the fourth-quarter consumer price index, which showed annual inflation rose to 4%, outside the Reserve Bank’s target band of between 1% and 3%, as vendors accounted for the government’s 2.5 percentage point hike in goods and services tax.

On an individual basis, lettuce saw the biggest price rise in the month, up 48.3%, as unusual weather condition added to typical seasonal cost increases. This led to prices being about three quarters higher that the average January level over the past 10 years.

Fruit prices followed their historical trend of peaking in January, with strawberries prices up 78%, mandarin prices up 38.9%, and kiwifruit prices, up 36.1%. The most significant downward contribution came from a seasonal fall in nectarine prices, down 30.1%.

Meat, poultry and fish prices rose for a second month, gaining 1.2% compared to December, non-alcoholic beverage prices rose 1.2%, and restaurant meals and ready-to-eat food prices rose 0.4%.

For the year, fruit and vegetables prices increased 8.1%, restaurant meals and ready-to-eat food rose 4.1%, and grocery food prices rose 3.9%. Meat, poultry, and fish saw annual price gains of 1.6% and non-alcoholic beverages rose 1.1%.

(BusinessDesk)

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