13 Sep 2016

Food costs up as price of bananas hits record high

1:55 pm on 13 September 2016

The cost of food rose 1.3 percent in August, pushed up by bananas hitting a record price high.

Bunch of bananas

The price of bananas has gone up 22 percent in a month Photo: 123rf

Bananas jumped by 22 percent to $3.51 a kilo, their highest price since records started in 1949, because of a supply shortage from Ecuador.

Over the last three years, Ecuador has overtaken the Philippines as the main supplier of bananas to New Zealand," Statistics New Zealand's consumer prices manager Matt Haigh said.

New Zealand households spend an average of $88 a year on bananas, which are the country's most popular fruit.

In contrast, avocado prices fell 25 percent after soaring earlier in the year.

Vegetable prices rose 8.9 percent overall, led by tomatoes, lettuce and cabbage, while cucumbers fell.

Higher prices for snack foods, cheese, and confectionery products pushed up the cost of groceries by 0.7 percent, while chicken prices fell to their lowest level since August 2007.

The average price of a kilo of chicken breast was $14.12 compared with $14.44 a kilo in July and $15.73 a year ago.

On an annual basis, food prices are up by 0.5 percent.

Banana shortage

Last August the country was hit with a banana shortage after a cargo ship bringing the fruit from Ecuador broke down.

Countdown spokesperson Kate Porter said the price increase this month was due to the same problem.

"A ship transporting bananas to New Zealand broke down off the coast of Ecuador in late August, which did cause an increase in the price of bananas during the shortage. However a new shipment of bananas arrived in New Zealand not long after, bringing the price back down."

Ms Porter said this week bananas were back at $2.99 a kg.

Foodstuffs New Zealand spokeswoman, Antoinette Laird said they were expecting banana prices to be back to normal range between $2.99 to $3.45 a kg by the end of the week.

"Price fluctuation is normal due to a variety of reasons but it is essentially down to supply and demand.

"Customers recognise that prices for produce can vary and we remain focused on getting the best prices we can for our shoppers," Ms Laird said.

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