Deputy Prime Minister David Seymour defends high butter prices, highlights benefits for farmers

Deputy Prime Minister David Seymour believes expensive butter should not necessarily be thought of as a bad thing, but rather a benefit for dairy farmers and an incentive-driver for a high-wage economy.

Butter prices have almost doubled in the past 14 months, the average 500g block soaring from $4.49 in April last year to $8.60 now.

In January 2015 the same block cost $2.97 and $1.98 in July 2007.

Although many shoppers are feeling this at the checkout, Seymour told Herald NOW’s Ryan Bridge that prices are set overseas and we should be happy about the money lining farmers’ pockets.

Act leader David Seymour says the high price of butter is a good thing for the economy. Photo / Mark Mitchell

“There are two ways you can look at this. One is to criticise the fact that, you know, prices are high, they’re set overseas, and they benefit New Zealand farmers.

“Or we can ask ourselves, how do we ensure that NZ has a growing economy, a high-wage economy, so that when prices spike like this it doesn’t have a big impact on families.”

He claimed petrol prices were low at the moment, and those were high when dairy was cheap so the consistent theme was that “need for a high wage economy”.

A ConsumerNZ spokesperson said Seymour’s comments “missed the point”.

“Our research this month has found that 70% of New Zealanders rank the cost of food and groceries as a top three financial concern.

“Most New Zealanders don’t believe the Government is doing enough to keep food affordable - two-thirds of people said they have low confidence in current Government policies.”

They said the conversation about butter prices “overshadows” the wider issue - prices are becoming unsustainable for more and more New Zealanders.

“Of course, we should be focused on growing a high-wage economy to roll with global price spikes - but when this is contrasted with an increasing number of people who are struggling to pay for the basics, we question at what cost?”

Yesterday, Finance Minister Nicola Willis met Fonterra chief executive Miles Hurrell to discuss the high prices, though Seymour said the meeting was not unusual.

“I think people have misrepresented the whole purpose of the meeting.”

Willis told Bridge yesterday morning the meeting would not solely be about butter, but the high price paid by New Zealanders for the dairy product would be on the agenda.

“I will be asking about their retail pricing model, how they’re seeing the supermarkets’ margins, how they’re seeing their own margins, understanding what’s getting through to the consumer and whether there’s anything we can do there.”

In May, Fonterra posted a $1.158 billion Q3 profit and pitched its farmgate milk price forecast for the 2025/26 season in a range of $8-$11 per kg of milk solids.

Inflation figures released yesterday show the consumer price index (CPI) increased 2.7% in the 12 months to the June 2025 quarter. That means the official inflation rate is at its highest point in the last year.

Green Party co-leader Chloe Swarbrick said there needed to be greater urgency when breaking up the supermarket duopoly.

“That looks, of course, like greater transparency around particularly supply chains. And there’s been a lot of words on it, but not a heck of a lot of action.”