Cost increases requested by suppliers to Countdown averaged eight percent in August, with meat (+12.2 percent), fresh produce (+12.9 percent) and bakery items (+9.6 percent) the main drivers. The New Zealand Food Price Index for August was 8.3 percent.
Countdown received four times the number of cost increase requests from suppliers in August 2022 versus the same month the year before, with requests ranging from a one percent increase to a 72 percent increase. Supplier costs make up almost two-thirds of the price of products at Countdown.
New Zealand isn’t alone with its food prices, big international markets like the UK have experienced 14-year high food inflation of 12.6 percent in July, and the USA saw food inflation of 10.9 percent.
“We pay our growers and farmers market prices for meat, dairy, fruit and vegetables, so higher international and local prices are reflected in what customers pay for their food at the checkout. Compounding this, a large portion of the products Kiwis rely on are imported from overseas, such as bananas, flour, pasta and toiletries. Inflation on imported products is roughly double that of local products,” said Steve Mills, Countdown’s Commercial Director.
“We understand the genuine cost pressures suppliers are under, whether that’s input costs like grain, fertiliser and freight, or domestic factors such as labour shortages and increased wage rates. However, we also know that our customers are facing a higher cost of living pressures from all parts of the economy, not just groceries. Our job remains focused on balancing all the different pressures and costs we are experiencing to provide the best value we can.”
