NZ food prices rise 0.9% in January as spike in apples drives up fruit, vegetable prices

Tuesday 14th February 2017

New Zealand food prices rose in January, as apples surged to a record high, leading gains in fruit and vegetables.

Food prices rose 0.9 percent, seasonally adjusted, in January from December, and gained 1.4 percent from January 2016, Statistics New Zealand said. On an unadjusted basis, food prices climbed 2.8 percent in the latest month.

Fruit and vegetables led gains in both the month and the year, up 8.5 percent (unadjusted) and 3.1 percent respectively. Apples, which have been in short supply in supermarkets, were an average $5.04 a kilogram in January, from $3.60/kg in December, reaching their highest since the series began. Fruit prices jumped 12 percent, or 2.9 percent seasonally adjusted, while vegetables gained 5.9 percent, or 1.4 percent seasonally adjusted, with gains in potatoes, broccoli and carrots.

The food price index accounts for about 19 percent of the consumers price index, which is the Reserve Bank's mandated inflation target when setting interest rates. The central bank expects inflation to accelerate to a 1.5 percent annual pace in the first quarter, having returned to within its 1 percent-to-3 percent target band for the first time in two years in the fourth quarter.

Prices of meat, poultry and fish rose 2.4 percent in January, with lamb up 11 percent and chicken rising 4 percent, but fell 1.1 percent from the same month last year. Chicken prices fell 7.2 percent in the year and have declined on an annual basis since June 2015.

Grocery foods rose 2.4 percent, or 1.4 percent seasonally adjusted, in January and increased 1.8 percent from a year earlier. Chocolate prices gained 14 percent in the month and fresh milk rose 4.4 percent.

Restaurant meals and ready-to-eat food prices rose 0.2 percent in the month and 1.8 percent in the year.

BusinessDesk.co.nz

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