The pace of supplier cost increases to Foodstuffs supermarkets remained steady in April.
The Infometrics-Foodstuffs New Zealand Grocery Supplier Cost Index (GSCI) showed an average two percent increase in what suppliers charged in April 2025, compared to a year earlier.
“This increase is the same as the result recorded in March, and is in line with expectations of broadly more settled cost trends - at least compared to recent years,” said Infometrics Chief Executive and Principal Economist Brad Olsen.
“A number of key products continue to see higher supplier costs, driven by offshore demand and supply trends. Costs for domestically-produced dairy and meat are being lifted by strong international demand, which is raising export prices and influencing local prices too.”
Every month, the Index tracks what it costs supermarkets to buy the goods to put on the shelf. Previous analysis shows that supplier costs are the major component of supermarket prices, representing two-thirds of the on-shelf price.
“A number of departments saw larger annual cost increases on average in April, with butter costs increasing further and pushing costs in the chilled foods category up 3.8 percent pa, as higher international dairy prices raise domestic costs too,” said Olsen.
“General grocery department costs rose further too, up 2.2 percent pa, as higher coffee and chocolate costs continue due to global supply trends. Cooking oil costs showed some signs of moderating, but only slightly. Higher beef demand globally saw domestic beef costs rise in April.”
Month on month, just over 2,600 products increased in cost in April 2025 compared to March.
This monthly increase is broadly in line with the 12-month moving average of 2,700 a month. The number of monthly cost increases has been bouncing around recently, with a lower number at the start of the year and a larger number of increases in March.
There are still a number of higher cost increases showing through, with 3.4 percent of cost changes in April being of the larger 40 to 80 percent magnitude.
Olsen added that some input costs, including for fuel, have moderated further, but cost and price pressure concerns remain for many businesses.
At present, costs are expected to increase at a higher rate than prices, but with a number of key products still rising in cost, most notably butter, the increases are set to be more noticeable.
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