Why fruit and vege prices are up 6%
We're constantly told to eat fresh and eat healthy but why are Cantabrians paying through the teeth for fresh fruit and vegetables? CHARLEY MANN reports.
Filling your shopping basket with fresh fruit and vegetables will cost you almost 6 per cent more than it did in January last year.
In the space of just one month, between December 2012 and January 2013, the price of fresh fruit and vegetables shot up 3.5 per cent, the recently released Statistics New Zealand's monthly Food Price Index showed.
The high fruit and vegetable prices had driven up the overall cost of food shopping, Statistics NZ prices manager Chris Pike said.
Leading the charge is lettuce, up 20 per cent since December last year, along with broccoli, which is up 38 per cent.
If you want to buy apples, you will be paying the highest price since 2008. The cost of kumara is up 98 per cent since 2012 and avocados are up 86 per cent.
"High kumara prices were influenced by poor weather conditions in both the planting and harvesting seasons, which affected the crop in 2012," Pike said.
Funky Pumpkin Colombo St manager Jim Fairlie, who has been in the grocery industry for 65 years, said a hailstorm that passed over Southbridge and Leeston late last year was to blame for high lettuce prices.
"We've had weather with extremes. All the lettuces were munted," he said.
Fairlie said the price consumers paid was a result of simple supply and demand economics.
Leigh Catley, communications manager of Horticulture New Zealand, blamed the sky-high lettuce prices also on demand for summer food. "Lettuce in summer is in high demand. People have a barbecue and want a salad."
A Countdown spokesman said the "weather dictates everything when it comes to fresh fruit and vegetable produce".
"For example, lettuce, cauliflower and spinach have increased in demand and price due to the extreme heat and lack of rain causing lower amounts of quality vegetables that can be harvested."
But what of the mark-ups that producers put on food?
Catley said large supermarket chains mark up fresh produce roughly 100 per cent to 200 per cent from what the grower was paid.
"The mark-ups on fresh produce is high, relative to most other products in store. However, there can be three or four different hands between the grower and the consumer."
Each store has its own formula for mark-ups that can change weekly or even daily.
Their are costs to maintain fresh produce, as well as transport.
Countdown, however, told The Press it aimed to sell a lot for a low price.
"On average, for every dollar customers spend in our stores, our business makes five cents profit before we pay tax so margins aren't excessive.
"Margins for fruit and vegetables haven't changed over the last year and the price on the shelf really reflects the price that we pay for the product from our suppliers, plus the cost of doing business," their spokesman said.
Foodstuffs said that prices varied due to seasonal availability. "Foodstuffs negotiates the price of produce with its suppliers on a weekly basis, which often depends on quality of the produce, seasonality and availability, and are determined by supply versus demand," said a spokesman.
But if you want more reasonably priced fruit and vege, the industry recommends you buy seasonal produce.
"Seasonal, with a capital S," Catley said.
Foodstuffs said citrus fruit including lemons and oranges are in season. "Seasonal vegetables to watch out for now are carrots, parsnips and eggplants."
Food prices have been steadily rising every year for decades.
Back in January 2009, prices rose 9.5 per cent from the same time in 2008.