Supermarket supplier costs up 7.5% on a year ago

August 7, 2023
Meat on sale at a supermarket, file.

Supermarket supply costs are up 7.5% from a year ago, according to new numbers released this morning.

Each month, the Infometrics-Foodstuffs New Zealand Grocery Supplier Cost Index tracks a number of items' prices.

"The year-on-year increase of 7.5% in July is the fifth month in a row that annual cost increases have moderated," Infometrics chief executive and principal economist Brad Olsen said.

"Despite this continued moderation in pace, monthly costs still rose at a pace consistent with an annual trend increase of 5-6% per annum, which is around triple the pace of cost increases pre-pandemic."

The Index tracks data across over 60,000 products Foodstuffs buys to put on shelves.

And costs remain higher than a year ago across all departments.

"Bakery saw the largest month-on-month increase in costs, with cakes and other sweet items driving this rise as sugar costs have increased," Olsen said. "Grocery costs rose further too, with chocolate a substantial contributor as higher cocoa input costs hit.

"Produce costs were driven up by tomatoes, salad greens, and some fruits, although some of these increases were seasonal."

Over 6500 items increased in cost in July, Olsen added: "The number of items rising in cost in July was the largest monthly total since February 2023, and was nearly five times higher than in 2020.

"A higher number of items increasing in cost reinforces the view that underlying pricing pressures persist, but they are less intense than in 2022. Some global issues remain, with rice, cocoa, and sugar prices internationally having an effect on New Zealand costs.

"Higher input costs for suppliers also appear to still be working their way through the system, with higher packaging and energy prices being persistent. Transport and freight costs are also set to push higher," he said.

SHARE ME

More Stories