Wholesale power prices rise
Wholesale electricity prices jumped in the March quarter because of low hydro lakes earlier in the year, pushing up producer prices.
Prices received by producers, the output producers price index (PPI), was up 0.9 per cent in the quarter, while the prices of goods and services used by producers, the input PPI, rose 1 per cent, Statistics New Zealand figures released today show.
"The higher prices for electricity generation contributed to both the higher input and output PPIs in the latest quarter," Statistics NZ prices manager Chris Pike said.
"This often happens in March quarters, due to spot-market conditions and low lake levels."
In the March quarter, the output electricity and gas supply price index rose 14 per cent, which contributed more than half of the rise in the output PPI.
The input electricity and gas supply price index was up 20 per cent, making up nearly three-quarters of the rise in the input PPI.
National hydro storage levels dropped heavily at the start of the year after dry weather, especially in the North Island, pushing up wholesale electricity prices significantly, until recent rains replenished South Island lakes.
For the year to March 31, the output electricity and gas supply price index rose 2.8 per cent, while inputs were up 0.7 per cent.
Meanwhile, higher prices for raw milk resulted in a4 per cent increase in prices received by dairy farmers.
The input prices paid by dairy product manufacturers were up 3.1 per cent in the March quarter.
In the year to March 31, the prices received by dairy farmers increased 47 per cent, and the prices paid by the dairy product manufacturing industry rose 39 per cent.
Overall, in the year to the March 2014 quarter, the output PPI was up 4.0 per cent, and the input PPI rose 3.1 per cent.