Source: Radio New Zealand
Takeaway coffee one of the biggest contributors to the annual increase. 123rf
An increase in the price of takeaway coffee in March helped pull food prices up 3.4 percent higher than a year earlier.
It follows a 4.5 percent rise in the 12 months to February.
Stats NZ said higher prices for meat, poultry and fish, up 7.3 percent, were the main drivers of March’s annual increase.
That was followed by restaurant meals and ready-to-eat food, up 2.8 percent.
The biggest contributors to the annual increase were steak, takeaway coffee, white bread and mince, Stats NZ said.
The average price of a takeaway coffee in March was $5.20, Stats NZ said, up from $4.88 a year earlier.
Coffee prices have been pushed higher as the cost of beans has risen but that pressure has eased more recently.
But other costs for cafes are likely to remain a concern, such as the price of dairy and rising fuel.
Infometrics principal economist Brad Olsen said the increase coming through now could also be a result of earlier increases that had not yet been passed on.
“Just a timing variation, probably because for items like coffee, they do only probably reprice a couple of times a year so you’re not going to see an immediate jump in those prices, they’re more going to bleed through over time.”
He said coffee bean prices were still higher than before the pandemic.
“Talking to people in the sector, those who are selling coffee are trying to eat as much as they can themselves so they don’t have to pass the price increase on. They’re worried that if they pass the full price increase on, people just won’t buy coffee out any more.”
He said the latest food stats included almost none of the recent fuel price increase.
“When we looked at our grocery supply cost index with Foodstuffs, what was quite clear there was that you weren’t really seeing any immediate impact.”
He said it was likely to only start to show up from May.
Foodstuffs said it experienced retail price rises of 3.7 percent in March.
Managing director Chris Quin said the rise in fuel prices would be felt across the food system.
“We’re seeing the early impacts of higher fuel costs, but some of that pressure will take time to show up on shelf because we’re at the end of global and domestic supply chains,” Quin said.
“We are working closely with suppliers to navigate a tough environment, while trying to protect customers from rising costs as much as we can.”
He noted that olive oil had dropped more than 20 percent, cauliflower was down 16.8 percent, apples down almost 15 percent and kumara down almost 14 percent.
Food prices fell 0.6 percent in March compared to February, Stats NZ said.
Contributors were kiwifruit, chocolate blocks, cheddar cheese and beef mince.
Sign up for Money with Susan Edmunds, a weekly newsletter covering all the things that affect how we make, spend and invest money.
– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
