Food prices spike 1.9 per cent

JASON KRUPP
Last updated 11:28 14/02/2013

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Food prices rose sharply in January, snapping a four month run of steady declines, led by higher grocery costs and seasonal fluctuations in fruit and vegetables. 

The Food Price Index rose 1.2 per cent in the month, according to Statistics New Zealand, following a 0.2 per cent decline in December. The data shows this is the biggest increase in a single month since July 2011.

"In January, higher food prices reflected more expensive grocery food, after falls in recent months," said prices manager Chris Pike. "We also had seasonally higher fruit and vegetable prices."

Grocery food prices rose 1.9 per cent in the month, led cake and biscuits (up 5.4 per cent), yoghurt (up 9 per cent), and bread (up 2.3 per cent). That was pared by a 17 per cent drop in the cost of olive oil.

The fruit and vegetable costs rose 3.5 per cent compared to December, led by a seasonal spike in the cost of mandarins, apples, lettuce, broccoli, strawberries and kiwifruit. Nectarines, pumpkin and oranges showed seasonal declines.

Meat, poultry and fish prices rose 2.2 per cent but the department said that was largely attributable to less discounting on lamb, with prices up 25 per cent in the month.

On an annual basis, food prices rose 0.8 per cent compared to January last year.

Fruits and vegetables were the most significant cost contributor, up 5.9 per cent, due to higher kumara, apple and avocado costs. Meat and poultry rose 1.9 per cent compared to a year ago.

Grocery food costs fell 1.5 per cent compared to last year, with the biggest declines coming from fresh milk (down 9.4 per cent), cheese (down 6 per cent) and butter (down 18 per cent).

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- BusinessDay.co.nz

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