The Foodstuffs grocery co-ops stated that global prices for dairy and meat continue to drive food price inflation in New Zealand, while prices for tomatoes are also increasing due to the current ban on tomato imports from Australia.
Stats NZ has reported a food price inflation (FPI) rate of 4.4 percent in May 2025, year on year, while the Foodstuff co-ops recorded an average 3.2 percent for their comparable FPI basket of products.
The co-ops have been monitoring inflation at their stores since 2022, based on a basket of goods in the same categories Stats NZ monitors.
Key drivers of Foodstuffs’ average 3.2 percent retail price increase in May were butter up 55 percent, cheese up 32 percent, beef steak up 25 percent, and lamb leg roasts up 23 percent.
Foodstuffs NZ Managing Director Chris Quin said butter prices have surged worldwide since late 2023 due to constrained supply and rising demand.
“Fortunately, Foodstuffs’ scale means we can keep offering competitive prices throughout the country. Right now, we’re selling butter at a loss because we’re committed to keeping essentials like butter as affordable and accessible as possible for customers,” said Quin.
“Meat is where inflation is being felt more keenly, given most of us eat more of it per day than butter. Beef commodity prices are still near record levels, with high demand for New Zealand exports, just as we’ve seen a decline in the national herd. To bolster supply, we’re even bringing in a bit more Australian beef, but only until local supplies improve in spring.”
Foodstuffs also saw a slight rise in the produce category, up 1.5 percent overall in May (YOY), influenced by increases of 30 percent for fresh tomatoes and 18 percent for both cucumbers and kiwifruit.
“Tomatoes are up due to seasonal supply and MPI’s ban on Australian imports since brown rugose virus was detected there last year. That’s to protect our domestic growers, but it does mean supply will be lower until there’s more sunlight and warmer temperatures here,” Quin added.
“So while Aussie tomatoes are off the shelves, a bit more Aussie beef is coming in – a reminder that New Zealand often relies on imports to supplement local supply and keep prices down or fill gaps entirely, and why it matters to have New Zealand-owned grocery retailers with the scale to compete for these products on global markets, if needed."
Foodstuffs’ retail prices were again outpaced by supplier costs, up an average 4.8 percent for products in the co-ops’ FPI basket, year on year. Earlier, Infometrics reported a two percent rate for the Grocery Supplier Cost Index, across 60,000 goods the co-ops stock, including non-foods.
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