Food prices expected to keep simmering, but pace may have peaked

Author: Liam Dann, NZ Herald,
Publish Date: Thu, 13 Oct 2022, 10:48am

Have food price rises peaked?

New data from Stats NZ at 10.45 this morning is expected to show prices lifted in September, for a rise of about 8 per cent annually.

While that means nominal prices almost certainly hit a new record high, economists will be looking for signs the pace of rising prices has eased.

Last month, annual food prices shot up faster than at any time in 13 years.

The 8.3 per cent leap for the year to August 22, compared with August 2021, was the biggest annual increase since the Global Financial Crisis in July 2009.

The surge in prices has been described as a perfect storm by economists.

A combination of pandemic supply issues, the war in Ukraine, labour shortages and tough local growing conditions have combined to put the squeeze on consumers.

Volatile fuel prices influenced shipping and other transportation costs, and freak weather in places damaged some fruit and vegetable crops.

Last November, heavy rain saturated cauliflower crops and affected new plantings.

In July this year, wild weather in Queensland was blamed for causing mayhem with asparagus and leek prices after some crops were obliterated.

Some of the food price stats are prone to seasonality, because some crops are only produced in certain seasons.

September data for rental prices is also due to today, ahead of next week's full consumer price index release for the September quarter.

New Zealand's CPI inflation rate was 7.3 per cent for the year to June 30.

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