17 Nov 2008

Cheaper vegetables bring down food prices

5:29 pm on 17 November 2008

Food prices fell last month, mainly because of cheaper vegetables.

Figures released by Statistics New Zealand show prices dropped by 0.3%.

Lettuce prices fell 50% and tomato prices fell 25%, but potatoes rose 20%.

Horticulture New Zealand puts the reductions down to better growing conditions, leading to more produce on the market.

Higher prices were recorded for food such as meat, poultry and fish, which, combined, rose 2.4% last month.

Prices for grocery food were also up slightly - mainly fuelled by bread increasing 3.2%.

The official figures show milk dropped 1% and cheese and eggs 2%.

Federated Farmers dairy chairman Lachlan McKenzie says the price drops are the result of the international fall in commodity prices, which is being passed on to consumers.

Mr McKenzie says there is potential for further reductions because of the economic slowdown.

Despited the falls, food prices remain almost 10% higher than they were a year ago.