Butter prices fell 10 percent in February 2019 to a 19-month low, says Stats NZ.
The average price for a 500g block of butter fell to $5.20 in February 2019, down from a record high of $5.79 in January 2019.
In January we saw milk prices fall to a 19-month low. This price fall now looks to be flowing on to other dairy products, says consumer prices manager Gael Price.
In February 2019 prices fell for cheese (down 4.1 percent), yoghurt (down 6.7 percent), and milk (down 0.2 percent).
Global dairy trade auction prices fell between June and November 2018. These were reflected in lower dairy export prices in the December 2018 quarter.
“The lower international prices appear to have been passed on to New Zealand consumers, with the usual lag of a few months,” says Gael.
Despite cheaper dairy products, overall food prices rose 0.4 percent in February 2019, mainly due to higher prices for soft drinks, waters, and juices.
Soft drink prices rose 8.4 percent in February 2019, reaching $2.70 per 1.5 litre bottle.
“Soft drink prices usually rise at this time of the year after typically being discounted over the summer,” says Gael.
Prices for confectionery rose 1.9 percent in February 2019, in part reflecting signs of ‘shrinkflation’. This was because some packets reduced in size, but their prices did not fall as much.
“We noticed the weight of some sweet packets were cut in February, when we collected prices on supermarket shelves. We may continue to see more shrinkflation in the coming months as new stock replaces old,” says Gael.