Producers affected by falling international commodity prices

Prices received by New Zealand producers, as measured by the producers price index (PPI), eased slightly (down 0.1 percent) in the March 2012 quarter, Statistics New Zealand said today.

In contrast, prices paid by New Zealand producers for goods and services they use rose 0.3 percent.

Manufacturers received lower prices for products such as meat, dairy, pulp, and paper due to lower international prices and a higher New Zealand dollar. This flowed through to lower prices paid to farmers for sheep, beef, and milk.

Prices received by sheep, beef cattle, and grain farmers were down by 2.7 percent on the previous quarter but were still 6.9 percent up from March last year.

The March 2012 quarter saw price increases for electricity due largely to lower hydro inflows.

In the year to the March 2012 quarter, the overall movement in prices received by New Zealand producers was an increase of 1.6 percent, while prices paid by producers were up 2.3 percent.

See also:
Producers Price Index: March 2012 quarter  –  Information release