Food prices rise in June as winter drives up cost of vegetables

Food price change monthly (Source: NZ Stats)
Food price change annual (Source: NZ Stats)

New Zealand food prices rose in June as the onset of winter brought on higher prices for out-of-season vegetables.

The food price index rose 1.4 percent in June, the fastest monthly pace since the same month a year earlier, and up from 0.6 percent in May, according to Statistics New Zealand. On an annual basis, food prices rose 1.2 percent, lower than the 1.8 percent annual increase in May, and are at their highest level since peaking in July 2011.

The monthly increase was underpinned by an 8.9 percent rise in the price of vegetables, driven by seasonally higher prices of tomatoes, lettuce and cucumbers, and a 9.9 percent rise in poultry prices, on reduced discounting, Statistics NZ said.

The annual gain was driven by an 11 percent rise in the price of fresh milk to a record high, and a 2.8 percent increase in the price of meat, poultry and fish. Fruit and vegetable prices were down 2.3 percent on an annual basis on cheaper avocadoes and bananas.

The food price index is the final component for economists to evaluate the pace of inflation ahead of next week's second-quarter consumers price index data, which is expected to show an annual increase of about 1.8 percent. Food prices are given a weighting of about 19 percent by Statistics NZ when assessing broader CPI.

Today's figures show grocery food prices, which make up about 38 percent of all spending on food, rose 0.5 percent in June, and were up 1.3 percent on an annual basis. Non-alcoholic beverage prices fell 1 percent in June, and were up 0.5 percent on the year, while restaurant meals and ready-to-eat food prices edged up 0.2 percent in June and an annual 2 percent.

(BusinessDesk)

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