Food prices record 0.4% annual increase, thanks to guilty pleasures

Thursday, 12 September 2024

Food inflation, staff shortages, soaring interest rates, and patchy customer demand are all pushing hospitality into survival mode.

Brunch, takeaway coffees, butter, olive oil and blocks of chocolate are pushing food prices up.

Food prices increased 0.4% in the 12 months to August 2024, following a 0.6% in the 12 months to July 2024, according to figures released by Stats NZ.

Higher prices for restaurant meals and ready-to-eat food and grocery food drove the annual increase in food prices, up 3.6% and 2.4%, respectively.

The price increase in grocery food was due to higher prices for olive oil, chocolate blocks, and butter - with blocks of chocolate increasing at an eye-watering percentage.

“The average price of a 250g block of chocolate has increased 20% since this time last year,” consumer prices manager James Mitchell said.

Potatoes are now the cheapest the food has been since 2021.

The price increase in restaurant meals and ready-to-eat food was due to higher prices for lunch/brunch, hamburgers, and takeaway coffees.

But the price of fruit and vegetables had dropped 12.2% in the 12 months to August, which was driven by lower prices for kūmara, potatoes, and lettuce.

Kūmara and potato prices were coming down from near-record-high levels in 2023.

In the 12 months to August 2024, the price of kūmara fell 53.9%, while the price of potatoes fell 26.6%.

“The average price of 1kg of potatoes in August 2024 was $2.18. This is the cheapest recorded since 2021,” Mitchell said.