Rising food prices – media response
12 July 2018
The NZ Herald asked for comment on the reason behind recent rises in the price of basic groceries, such as eggs, milk and bread. Was it due to rising taxes on fuel prices and if so, how can a fuel tax influence prices of such foods?
Katherine Rich responded:
In the past year there have been major food production cost increases, such as wages (minimum wages and the flow-on effects for parity), fuel costs, fuel taxes, energy cost, customs and other government department fees, eg MPI, and retailer margin expectations are significant, more than 30% in many circumstances. There’s been a perfect storm in terms of changes that influence the cost of manufacturing food in New Zealand and that’s why we’ve seen some high-profile manufacturing exits and restructures lately. The cost of making food has gone up. Eventually, these increases have to be reflected in food prices.