Food prices rise 0.3 percent in May 2012

Food prices rose 0.3 percent in the May 2012 month, following a 0.1 percent fall in April, Statistics New Zealand said today.

"While food prices rose in May 2012, they are 0.2 percent lower than they were in May last year. The last time food prices fell over the year was in August 2010," Statistics NZ prices manager Chris Pike said.
The most significant increase in May came from the fruit and vegetables subgroup (up 3.2 percent), mainly due to a seasonal increase in tomato prices (up 58 percent). Seasonally higher prices were also recorded for cucumber (up 70 percent), capsicums (up 20 percent), avocados (up 16 percent), and courgettes (up 49 percent). The most significant downward contributions to fruit and vegetable prices came from seasonally lower prices for kiwifruit (down 51 percent) and mandarins (down 31 percent).

Prices for the non-alcoholic beverages subgroup also rose in May (up 2.2 percent) due to less discounting on soft drinks (up 2.5 percent).

Over half of the items in the meat, poultry, and fish subgroup (down 1.5 percent) decreased in price, with increased discounting for ham (down 7.5 percent), sausages (down 4.1 percent), and corned beef (down 14 percent).

The grocery food subgroup (down 0.5 percent) had downward contributions from fresh milk (down 5.7 percent), chocolate (down 4.4 percent), and butter (down 14 percent). The drop in fresh milk prices was the largest since an 8.1 percent drop in September 2006, and the last time prices were lower was in June 2010. Butter prices are now 28 percent below the highest peak, which was in June 2011.

For the year to May 2012, food prices fell 0.2 percent. Three of the five food subgroups made downward contributions to the food price index (FPI). Lower prices were recorded for meat, poultry, and fish (down 2.3 percent), grocery food (down 0.2 percent), and non-alcoholic beverages (down 0.7 percent). Higher prices were recorded for fruit and vegetables (up 0.2 percent) and restaurant meals and ready-to-eat food (up 1.6 percent).

This is the first annual fall in grocery food prices since a 0.7 percent fall for the year to July 2010. Fresh milk prices are down 7.2 percent on May last year, with prices for cheddar cheese (down 15 percent) and butter (down 25 percent) also lower than in May last year.

The FPI measures the rate of price change of food and food services purchased by households. Statistics NZ visits shops across New Zealand to collect prices for the FPI and check package sizes.

See also:
Food Price Index: May 2012  –  Information release