A second dairy giant has said it will raise its prices after market leader Mainland announced a 6 per cent price hike yesterday.
Mainland Products Ltd, the New Zealand retail unit of Fonterra, said it was raising prices because of higher international milk prices and rising electricity costs.
New Zealand Dairy Products
(NZDP) chief executive Peter McClure told The Press yesterday it was considering higher prices for similar reasons, because it got its milk products from the same place as Mainland.
Mainland, which sells about half the cheese, milk and butter consumed in New Zealand, will raise its prices for the first time in three years on March 1, chief executive Geoff Norgate said yesterday.
NZDP, which makes the Anchor range, said it would give details of its price hike by the end of next week.
Alternative milk company A2 Corporation said any rise in the price of its milk would be up to the four processing firms that produced and sold it.
Mr Norgate said the increase would push the average price of 500g of butter up about 10c to around $2 and a 1kg block of cheese would become about 30c more expensive.
Shop prices would be determined by retailers.
The increases were the first in almost three years and had been forced on Mainland by increased operating costs and higher international dairy commodity prices, he said.
"The catalyst was an announcement by Fonterra in December that payouts to (dairy) farmers will increase this season. That took us a bit by surprise," Mr Norgate said.
Mainland sells milk, cheese, butter and other dairy goods under its own label and through its Meadowfresh, Tararua, Galaxy and Ferndale brands.
- NZPA
