New Zealand Food Prices Grew at Highest Annual Rate in Over a Decade

Groceries being packed at New Lynn New World supermarket in Auckland, New Zealand, on July 1, 2019. Fiona Goodall/Getty Images

Food prices in New Zealand (NZ) over the year to March 2022 grew at the fastest rate, 7.6 percent, in over a decade, according to Stats NZ.

It was the largest increase since the year to July 2011, where prices increase 7.9 percent on the back of a GST increase from 12.5 to 15 percent.

Fruit and vegetables led the price hike, rising a staggering 18 percent, followed by meat and fish at 8.7 percent.

“Average prices for vegetables like tomatoes, broccoli, iceberg lettuce, and cabbage were notably higher than they were in March 2020 and 2021,” Stats NZ consumer prices manager Katrina Dewbery said.

There was a monthly food hike of 0.4 percent in March, led by fruit and vegetables.

“The average price of cabbage increased 28 percent in March, from $3.92 to $5.03 per kilogram (US$5.84 to $7.50 per pound),” Dewbery said.

However, avocados, boxed chocolates, and bacon experienced decreasing prices.

Shoppers queue up at checkout at a supermarket in the suburb of Johnsonville in Wellington, New Zealand, on Aug. 11, 2020. Marty Melville/AFP via Getty Images

Finance Minister Grant Robertson told First Up that the rising cost of food was a global issue caused by disrupted supply chains.

“And as a result of that, the solutions to it are difficult for New Zealand on our own,” he said.

Commerce and Consumer Affairs Minister David Clark said the food price figures confirmed the need to “rein in the super-profits of the supermarket duopoly.”

“The March increase is above general inflation figures and highlights the role the grocery sector is playing in driving up prices,” Clark said. “Rising food prices is a global issue. ... But that is exacerbated here by the lack of competition at the checkout.”

The Commerce Commission’s grocery market study, published on March 8, found that the supermarket duopoly was making profits at the expense of Kiwis.

“Even at their conservative estimate, the market study found that the major grocery retailers were earning excess profits of around $1 million a day, well above what would be expected in a workably competitive market,” Clark said.

It also found that the average return of major grocery retailers, at 12 percent, was more than double that of normal returns of 5.5 percent.

“No matter how you cut it, it’s clear that New Zealanders are paying too much for their food and groceries,” he said.

Clark said the government will announce its response to the Commerce Commission’s recommendations next month and he also has not ruled out going even further than the tabled options to change the competition issues for supermarkets.