Woolworths' buy-up unlikely to lower prices

Australian supermarket giant Woolworths' buy-up of three New Zealand supermarket chains is unlikely to result in lower food prices, says the Consumers Institute.

A comparison of the Woolworths New Zealand and Australia online sites reveals most products already cost more across the Tasman.

Institute chief executive David Russell said the deal would probably give the three local chains more buying clout, but could also signal less product choice.

But cheaper groceries could still happen if The Warehouse and German discount trader Aldi, which already operates in Australia, made a foray into New Zealand food retailing, said Mr Russell.

The Australian company, until now unrelated to the New Zealand chain that shares its name, struck a $2.67 billion deal last week to buy local supermarket operator Progressive Enterprises from its Australian owner Foodland, with a number of Australian supermarkets.