Butter prices drop almost 5 percent in December

Butter prices drop almost 5 percent in December – Media release

15 January 2018

Butter, chocolate bars, and wholemeal bread prices all fell in December, Stats NZ said today. Tomatoes and nectarines were also cheaper, but avocado prices remain almost twice as expensive as they were a year ago.

After four successive monthly rises, butter prices dropped 4.9 percent in December 2017 to an average of $5.46 for the cheapest available 500g block. This compared with the previous month when they hit a record high of $5.74. Butter prices had been falling at international dairy auctions since October.

Total food prices were down 0.8 percent in December, as all store-bought food groups fell during the month. Grocery food and seasonally cheaper fruit and vegetables were the main factors in the dip in food costs.

Chocolate bars and wholemeal bread drove the 1.3 percent fall in grocery food prices. Chocolate bars fell to $1.44 for a 50g bar, down 8.4 percent.

“Specials on grocery items drove food prices down this month, but the higher prices for dairy, fruit, and vegetables throughout the year meant consumers were still facing 2.3 percent higher food prices than last December,” prices manager Matthew Haigh said.

Fruit and vegetable prices fell 1.7 percent this month, led by seasonally lower prices for tomatoes and nectarines. Despite the monthly fall, fruit and vegetable prices are still 4.5 percent higher than this time last year, due to a 231 percent increase in pumpkin prices, and an 88 percent increase in avocados.

“Avocados are usually at their cheapest this time of year, but prices are still relatively high this December,” Mr Haigh said. A 200g avocado had an average price of $2.31 in December 2017, compared with $1.23 the previous year.

Bread and cereal prices on the decline

Although food items generally go up in price over time, breads and cereals are continuing a downward trend that began in early 2013, with prices falling 1.1 percent each year. A 700g loaf of grain bread had an average price of $3.10 in December 2017, compared with $3.75 in January 2013.

“Global wheat prices have been declining since late 2012, and from 2014 we saw a number of retailers holding their prices for cheapest available white bread fixed at $1,” Mr Haigh said.

Video

View our Food price index: December 2017 video

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