Lower food prices due to bumper crops can be seen in data showing sharp declines in the prices of many veggies in January, but freight disruptions are continuing due to geopolitical events.
Food prices increased 4.0 percent in the year ended January 2024, however the annual change was the lowest reported since November 2021.”
Stats NZ has reported a 4% increase in the Food Price Index (FPI) forthe year to January 2024 — the annual change was the lowest reported since November 2021.
By comparison, Foodstuffs has recorded a 3.9% annual average increase in prices across more than 500 of its stores for the same categories measured in the FPI basket.
Many fresh food favourites like tomatoes and avocados decreased in price, though, year-on-year – some by over 20% – which Foodstuffs’ experts put down to bumper produce supply at the right time of year.
Foodstuffs NZ managing director Chris Quin says lower prices have been assisted by this year’s long, warm summer.
“There’s real benefits to shopping seasonally if you’re looking for value right now, because the prices of produce and meat fluctuate depending on the level of supply,” he says.
“So when something’s in season and in abundance because of a bumper crop, the prices tend to be lower.”
Red Sea impact kicking in
Foodstuffs says it has started to see some of the container delays caused by the attacks on ships in the Red Sea, however at this stage it is not expecting serious shortages as a result.
Shipping companies are either going around South Africa, adding around three to four weeks to their journey, or through the Panama Canal, which is currently experiencing delays due to lower-than-usual water levels.
Quin says the Foodstuffs co-ops’ commitment not to pass on extra shipping charges to shoppers still stands, and teams are continuing to work hard to plug potential supply gaps of imported products.
“There’s a possibility the longer travel times out of Europe could lead to a container shortage, which may affect imports out of other markets. This is only a medium risk, however, with no impacts at this stage,” Quin says.
“The general message to shoppers is that prices can go up and down, due to factors like weather and war. These unforeseen events are challenging to anticipate and our experts are laser focussed on ensuring the essentials still get through, and that we continue to deliver value at the checkout.”
