Winter weather has played a part in the latest food price inflation statistics for June, with the product cost of dairy and beef still key contributors, while olive oil prices finally fell.
Stats NZ has reported an annual food price inflation (FPI) rate of 4.6 percent in June 2025, while Foodstuffs recorded an average year-on-year retail price increase of 3.7 percent for their comparable FPI basket of products, below total FPI for the fourth month in a row, and 31 of the past 38 months.
Average prices for milk, cheese and eggs were up 7.5 percent in June 2024, meat, poultry, and fish rose 6.7 percent, and fruit and vegetables 4.6 percent. Products seeing the biggest year-on-year increases included cauliflower +49 percent , butter +44 percent , lamb leg roasts +37 percent, cheese +31 percent, and beef steak +25 percent.
Foodstuffs NZ Managing Director Chris Quin said that June’s weather fuelled the higher FPI rate, after last year’s relatively settled winter allowed bumper crops and sharper prices.
This year’s return to less settled winter conditions has meant slower growth rates and damage to some crops, leafy greens in particular. High power costs are hurting greenhouse growers, too.
Quin added that high global prices for dairy, beef and lamb continue to have an impact here, although the rate of butter’s price rise in June, +44 percent YOY, was the slowest Foodstuffs has seen all year.
“While the price of butter has fallen at the last two Global Dairy Trade auctions, to six percent below its May peak, it’s still 55 percent higher than two years ago. Customers are feeling it, and that’s why our co-ops are continuing to sell butter at a loss, to keep it as affordable as possible," said Quin.
“We’re glad there’s growing recognition retail prices for our dairy and meat are largely determined by what the world is willing to pay. And what shouldn’t be forgotten when comparing prices here with Australia and the UK is they don’t pay GST on most grocery foods.”
On a positive note, olive oil was 4.6 percent cheaper than in June 2024 – the first month Foodstuffs has recorded a year-on-year price decrease for olive oil since January 2024.
“Olive oil supplies have rebounded in Europe, and further price reductions are possible, though at around NZD 18 a litre it has a way to go before it gets back to where it was then, below NZD 12.”
Foodstuffs’ retail price increases were again outpaced by supplier costs, up an average 5.4 percent year on year for products in the co-ops’ FPI basket.
“We’ve long said the key factors driving food price movements in New Zealand are global supply and demand, and domestic weather conditions. They influence what suppliers charge us for their goods, which in turn accounts for about two-thirds of the shelf price for customers.”
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