Wednesday, December 6, 2023

Fruit and veg prices rocketed in February

Neal Wallace
Stats NZ reports food prices overall were 12% higher in February than a year earlier, with grocery food the largest contributor.
The price of tomatoes rose 117% in February, in a month when food prices were 12% higher that the same month a year earlier. Potatoes, broccoli and lettuce also rose sharply.
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Fruit and vegetable prices rose a massive 23% in February – the highest monthly increase in more than 40 years – as growers weathered a season from hell along with higher costs.

But the impact on northern growers from a wet, stormy summer will be felt even more keenly as they are left with low volumes of export-quality kiwifruit, onions, pumpkins and apples.

Jerry Prendergast, the president of the pan-product industry group United Fresh, said despite northern fresh fruit and vegetable growers taking a battering, domestic supplies and distribution networks stood up reasonably relatively well.

While consumers paid more for fruit and vegetables, there were shortages of some greens and it is estimated 70% of the Northland kumara crop has been washed out by flooding.

Stats NZ reports food prices overall were 12% higher in February than a year earlier, with grocery food the largest contributor, although tomatoes (117%) and potatoes (48%) rose sharply, along with broccoli and lettuce.

Prendergast expects some vegetable growers may look for other land uses as business scale becomes more important in the wake of the storms and rampant inflation.

He said the storms and wet weather variously impacted key vegetable growing areas of Pukekohe and Horowhenua, but Nelson-Tasman largely escaped and helped fill the produce gap.

Prendergast said supply shortages out of Pukekohe actually started last year when wet weather disrupted planting. This was accentuated by the summer storms.

He said summer’s disruptions show consumers may need to be more flexible in their expectations of year-round supply of some product.

“We’ve come to expect lettuce in winter, but you only go back a decade or two and you only had some produce in summer and some in winter.”

Brigit Corson, the head of produce and butchery with Foodstuffs North Island, said quality specifications for apples and kiwifruit could be temporarily adjusted as fruit is redirected from export to domestic markets.

Corson said supermarket staff have been in Hawke’s Bay and East Coast meeting with growers. Given the volume of produce likely to be redirected, they will work with growers to ensure these are marketed in an orderly fashion.

Foodstuffs draws its produce from different regions and this summer sourced product from the South Island to fill some gaps, and imported beans from Australia.

The season for products such as sweetcorn and watermelons was much shorter due to a lack of product.

Corson said the supply chain proved resilient due in part to lessons learnt during covid on how to deal with disruption.

The improved weather will ensure an abundance of greens and root vegetables in the coming months, but she warns prices will be higher due to rising input costs experienced by growers.

A spokesperson for the Countdown chain said it has been meeting and working closely with the more than 100 growers to assess the effects of Cyclone Gabrielle on fruit and vegetable supply.

“More widely, across our business our priority is to make food, including fruit and vegetables, as affordable as we can for Kiwis and sensitively manage the industry-wide inflationary pressures we and our partners are seeing.”

The 12% increase in food prices last month compared to February 2022 was the largest monthly increase since November 1980 when the food price index rose 12.4% and September 2008 when it hit 10.8%. 

Stats NZ data shows restaurant meals and ready-to-eat food prices increased 8.4%, meat, poultry and fish prices 9.8% and non-alcoholic beverages 9.1%.

“Increasing prices for barn or cage-raised eggs, potato chips and cheddar cheese were the largest drivers within grocery food,” Stats NZ consumer prices manager James Mitchell said. 

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