After adjusting for seasonal effects, fruit and vegetable prices fell 0.2 per cent in October. Photo / 123rf
After adjusting for seasonal effects, fruit and vegetable prices fell 0.2 per cent in October. Photo / 123rf
Food prices have fallen for the first time since February, but remain significantly higher than this time last year, according to Stats NZ.
Cheaper fruit and vegetable prices drove the fall in October, with overall food prices dropping by 0.9 per cent for the month, compared to September.
After adjustingfor seasonality, prices fell 0.1 per cent in October 2021.
Economists say although fruit and vegetable prices are down in October it is still 9 per cent higher than last year and meat prices are likely to come under pressure.
Fruit and vegetable prices fell 5.9 per cent in October, while non-alcoholic beverages, meat, poultry, and fish were also cheaper than in September, the data showed.
October's movement is the first monthly fall since February 2021, when prices also fell 0.9 per cent.
Fruit and vegetables main contributors to monthly fall
Some of the bigger movers included tomatoes (down 26 per cent), iceberg lettuce (down 23 per cent), capsicums (down 22 per cent), and cucumbers (down 25 per cent).
"These falls were partly offset by rising prices for kiwifruit (up 41 per cent), broccoli (up 9.8 per cent), and carrots (up 9.5 per cent)," Stats NZ reported.
Consumer price manager for Stats NZ Katrina Dewbery said the weighted average price of tomatoes was $12.04 per kg in October, down from $16.27 in September.
"However, tomato prices are still 47 per cent higher than they were in October 2020, when the weighted average price was $8.18 per kg. Lettuce, capsicum, and cucumber prices are also all higher than they were in October last year," she said.
After adjusting for seasonal effects, fruit and vegetable prices fell 0.2 per cent in October.
"The small movement in the seasonally adjusted series for fruit and vegetables indicates that most of the 5.9 per cent fall in the non-seasonally adjusted series was due to seasonality," Dewbery said.
Prices for non-alcoholic beverages fell 1.6 per cent in October, mainly influenced by lower prices for 1.5 litre soft drinks (down 6.8 per cent).
Meat, poultry, and fish prices fell 0.4 per cent in October, with lower prices for chicken pieces (down 2.1 per cent) and roasting pork (down 6.0 per cent).
These falls were partly offset by restaurant meals and ready-to-eat food prices (up 0.4 per cent). Grocery food prices were flat.
Still, on an annual basis food prices increased 3.7 per cent in October 2021, mainly due to higher prices for restaurant meals and ready-to-eat food (up 5.0 per cent), fruit and vegetables (up 9.0 per cent), and grocery food (up 3.1 per cent).
"October's annual movement is slightly lower than September's 4.0 per cent increase but still higher than the average annual increase over the last year of 2.3 per cent," Dewbery said.
Infometrics senior economist and director Brad Olsen. Photo / Tania Whyte
Infometrics senior economist Brad Olsen said although food prices are down in October from September, that's a fairly normal seasonal fall, with monthly falls in October 2018, 2019, and 2020.
"Removing that seasonality, prices still fell 0.1 per cent from September. This slight falls looks to be a minor reversing out of higher prices in September when prices were higher than expected," he said.
The reason fresh fruit and vegetable prices were key to this month's decline in prices due to the seasonal availability of the food produces.
"As we head into summer, these seasonal moves will see expanding support of fruits and vegetables which will drive prices lower," he said.
"Notably, food prices are still up 3.7 per cent from a year earlier, and continued price rises for some foods look set to continue.
"Fruit and vegetable prices are still up 9 per cent from a year earlier, highlighting that household budgets are still under pressure.
"Meat prices are likely to come under pressure further as suppliers lift prices too, with higher annual price rises in recent months already," Olsen said.
