Tegel to lift chicken prices by 10 per cent
Monday, 9 August 2021
New Zealand’s largest poultry supplier Tegel is raising chicken prices from mid-August.
It said the roughly 10 per cent price rise was a result of pressures on the industry, including increases in the cost of labour, feed and fuel impacting supply chain costs.
“Kiwis have been enjoying low chicken prices since 2014 when chicken breast was $17 per kilogram, compared to as low as $7 today,” said Tegel’s general manager of sales Yvonne Van Nes.
“This is the first across-the-board increase we have done in some time and it reflects the current cost of raising a chicken and distributing it to our network.
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“Although people may see the prices of whole chicken and chicken products go up later in the year once the increase kicks in, Tegel chicken will continue to be a reasonably priced meal option for Kiwi families,” said Van Nes.
“Chicken was once a luxury protein but over time it has become the most affordable of the meat proteins. Not surprisingly, New Zealanders are now eating more chicken than ever before.”
Tegel said New Zealand’s consumption of red meat was dropping while consumption of poultry grew 18 per cent in the 10 years to 2020 and then another 33 per cent to 2020.
Stats NZ data shows that the price of a frozen number 15 whole chicken has fallen from $9.66 in 2014 to $7.45. A kilogram of chicken nuggets has dropped in price from almost $12 to $10.60 over the same period.
Katherine Rich, chief executive of the Food and Grocery Council, said Tegel should be commended for its transparency. Many other food suppliers were facing similar cost pressures, she said.
She said Tegel was dealing with concerns that were shared by many other businesses, such as the increasing cost of freight and logistics, increasing labour costs, difficulty getting staff, increasing energy and insurance costs.
“Getting people to work in our factories across our supply base is really hard. If you've got the workforce you’re still struggling to keep up with local production and there’s more overtime.”
Tegel’s bill for chicken feed was increasing as it became harder to get goods into the country, she said.
'I completely understand how shoppers dislike any kind of price increase but in this instance they have little choice.”
A spokeswoman for Countdown said the pressures were industry-wide but no other chicken suppliers had signalled price increases yet.
“There are a lot of factors that go into the price of food in New Zealand, including labour and transport costs, GST, seasonality, demand and raw materials. Our buying team talks to our supply partners every day to try and get the best value we can for Kiwis. We’ll now work with Tegel to understand what these cost increases might mean for us and our customers.”
Michael Brooks, executive director of the Poultry Industry Association, said pricing was a commercial decision for each individual company.