Tomatoes and bananas influence food price fall

Food prices fell 1.3 percent in August 2011, but were up 6.6 percent on a year earlier, Statistics New Zealand said today. Fruit and vegetable prices fell 5.9 percent for the month, reflecting a drop in tomato and banana prices.

Tomato prices fell 25 percent in August after peaking in July. "Tomato prices averaged just under $10 a kg in August, after reaching more than $13 a kg in July," Statistics NZ prices manager Chris Pike said. Banana prices fell 21 percent, to their lowest level in five years. Good growing conditions overseas led to a temporary increase in imports.

Four of the five food subgroups recorded price falls in August 2011. The meat, poultry, and fish subgroup fell 0.9 percent. The main contribution came from a 4.2 percent fall in fresh chicken prices, partly influenced by more discounting than in July.

In August 2011, grocery food prices fell 0.3 percent, reflecting lower prices for cheese (down 5.4 percent), cakes and biscuits (down 2.7 percent), and yoghurt (down 6.2 percent after peaking in July). More discounting than in July contributed to these falls.

In the year to August 2011, food prices increased 6.6 percent, down from the 7.9 percent increase for the year to July 2011. Both increases included a 2.2 percent rise in October 2010, when goods and services tax rose.

All subgroups had price increases in the year to August 2011: grocery food (up 6.2 percent), fruit and vegetables (up 13.2 percent), restaurant meals and ready-to-eat food (up 4.2 percent), meat, poultry, and fish (up 5.0 percent), and non-alcoholic beverages (up 6.6 percent).

Geoff Bascand 13 September 2011

Government Statistician