New Zealanders are facing steep price increases for basic food products such as eggs, yoghurt and potatoes, while supermarket profits are sky-high and the recession is predicted to deepen.
Government data released on Monday shows New Zealand’s food prices have gone up 12.1% year on year. Fresh food has been affected the most of all, with the biggest increases for fruit and vegetables – up 22% – and grocery items up 14%. Some staples have gone through the roof: eggs are up 63% year on year, and yoghurt is up 21.7%. Pastry products are up 17.6%, poultry 15.2%.
Here, you can see the price changes over time for all the food items and groups tracked by Stats NZ.
The interactive chart shows the percentage change in price, which compares the price for a given month with the same month a year earlier.
It can be toggled to show the price index – which is the cost of the item in June 2017 represented as 1,000 and other years presented relative to this.
The price increases come as supermarket profits remain high in New Zealand, and the government continues investigations into how to better regulate the supermarket corporation duopoly. The commerce commission concluded in 2022 that the major supermarkets were making around $430m a year in excess profits, and returns of 12.9% on capital, when strong competition should produce returns of about 5.5%.
“It’s hitting everyone,” said Isobial Jackson, of Taupo, where she said the cost of a tray of eggs had more than doubled. Jackson started an online group during New Zealand’s Covid lockdowns to share budget-saving tips and tricks, in conjunction with her daughter who was studying and on a strictly limited budget. The group has grown to nearly 10,000 members who swap advice on anything from how to make your own bulk dog food to drying chicken skins for flavoured salt.
Jackson says the group tries to keep things positive and upbeat. At times, however, the discussion can spill over from recipe swapping and musings over the cost/benefit investment of growing vegetables, to members sharing the toll on their mental health or seeking help with how to stretch $100 to feed a family of four for a week. “There’s not one person who’s not feeling it,” she says.
Frustration has been growing at supermarket profits. This week, a collective of 46 New Zealand growers and suppliers went public with the gross profit margins made by supermarkets on some of their products – with things like lettuce doubling in price between the supplier and the supermarket shelf. “It’s the consumer getting screwed,” they told television station Newshub on Monday.
Foodstuffs, one of New Zealand’s two major supermarket corporations, responded in a statement that “everyone growing, manufacturing, and retailing food is fighting rising costs with inflation at 30-year highs … The costs of goods from suppliers are the largest cost for our business, making up 68 cents of every retail dollar on shelf.”
Inflation remains stubbornly high in New Zealand, at an annual rate of 7.2%. Some of the major banks predict a difficult economic year ahead. ASB’s chief economist, Nick Tuffley, said the bank was forecasting a longer and deeper recession than previously anticipated.
“The economy is buckling a little earlier than expected. We expect that in total the economy will contract upwards of 2% by early 2024,” Tuffley said.
The bank anticipated rising living costs would add about $150 to weekly household costs. “We don’t expect household income growth will keep pace with these increases, despite another year of strong wage growth.” he said. “It’s going to be a tough year.”
