Cheap bread stays as supermarket war wages

Cheap loaves of bread are here to stay - at least for the foreseeable future, the country's major supermarkets have confirmed.

Countdown, New World and Pak'nSave say they have noticed increased demand for bread as a result of the lower prices. A price war, which began last month between the supermarket rivals, saw the price of bread drop to just $1.

Countdown is owned by Progressive Enterprises, while New World and Pak'nSave supermarkets are owned by Foodstuffs.

The cheap bread was not a limited time "loss leader" for Countdown, but rather the "new everyday price on this popular bread range", Countdown managing director Dave Chambers told the Herald.

"We increased production to ensure we didn't run out, and throughout the country strong demand continues," he said.

Countdown's "Price Lockdown" promotion for bread resulted in the chain's Homebrand white and wheatmeal bread drop from $1.48 to $1.00 on July 18, with a customer limit of four loaves per shop.

Foodstuffs marketing general manager, Steve Bayliss said it has been a challenging year for Countdown and 'reaching for the price lever aggressively' to regain lost ground was not surprising.

While customers are the big winners from the price war on bread, Bayliss says this comes with a warning.

"We don't believe the current pricing is economically sustainable long term and prices will eventually rise."

New World's "Price Limits" promotion offers Budget brand 600g loaves also for $1 with a limit of five.

"In a hyper competitive market, where no brand wants to give the competition an inch, we're unlikely to see pricing tensions easing in the near term," he said.

Some critics have labelled the cheap bread promotion as unhealthy.

Tauranga nutritionist Angela Frieswyk said she recommended most clients stay away from bread, especially white bread, as much as possible.

"I would prefer to see places like supermarkets discount veges," she said.