Wholesale grocery prices driving up food costs
A steady rise in wholesale grocery prices is driving up the cost of a wide range of products.
Infometrics-Foodstuffs' New Zealand Grocery Supplier Cost Index (GSCI) indicates supermarkets paid two percent more for groceries last month over the year earlier.
"A number of fruits and vegetable costs rose over the month, alongside higher beef costs as international protein prices remain elevated," Infometrics chief executive and principal economist Brad Olsen said.
"Butter, cheese, and yoghurt costs rose further, with lower dairy supply globally amid strong demand which has pushed up international and domestic costs.
Chocolate and coffee costs rose further in May, but olive oil costs have levelled off, he said.
"Supplier costs also rose across a number of nut varieties, and for potato chips."
Olsen said research indicates supplier costs were a major component of supermarket prices, representing two-thirds of the on-shelf price.
"Cost escalation concerns remain, with higher import costs occurring in the March quarter, and at a faster pace than previously seen," he said.
"Improving supply of some international inputs has contributed to some supplier cost increases levelling out, but costs still remain at elevated levels."
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