Food Price Index: November 2009

Food prices in November 2009

Food prices fell 0.3 percent in November 2009, following decreases of 1.5 percent and 0.7 percent in October and September 2009, respectively. This is the fourth consecutive fall in the food price index (FPI), the first time this has happened since four consecutive monthly falls beginning in April 2004.

In November 2009, lower prices were recorded for the fruit and vegetables subgroup (down 2.0 percent), non-alcoholic beverages subgroup (down 0.8 percent), and grocery food subgroup (down 0.2 percent). Higher prices were recorded for the meat, poultry, and fish subgroup (up 0.1 percent) and the restaurant meals and ready-to-eat food subgroup (up 0.6 percent).

The most significant individual downward contributions came from lower prices for tomatoes (down 33.0 percent), broccoli (down 51.5 percent), and minced beef (down 8.7 percent).

The most significant upward contributions came from the price of nectarines doubling (up 100.0 percent), as well as price increases for bacon (up 5.8 percent) and carrots (up 21.7 percent).

Distribution of item-level movements

The table below outlines the distribution of price movements in October 2009 and November 2009. The FPI has been partitioned into those national item-level indexes that increased, showed no change, or decreased.

The distribution of item-level movements shows that:

• the percentage of expenditure weight of items that increased in price rose significantly, while the percentage of expenditure weight of items that decreased in price fell significantly.
• the weighted average price decrease was greater than the weighted average price increase.
• the weighted average price decrease fell while the weighted average price increase rose.

Annual movements

Food prices increased 0.9 percent in the year to November 2009, following increases of 2.0 percent and 3.3 percent in the years to October and September 2009, respectively. The November 2009 annual increase is the lowest annual increase since a 0.9 percent rise in the year to September 2005. This is the fourth month in a row where the annual increase has been lower than the month before.

Four of the food subgroups increased in the year to November 2009. The most significant upward contributions came from higher prices for non-alcoholic beverages (up 6.9 percent), followed by restaurant meals and ready-to-eat food (up 3.0 percent), grocery food (up 1.5 percent), and meat, poultry, and fish (up 1.0 percent).

The only subgroup to decrease was fruit and vegetables (down 7.6 percent).

The most significant upward contribution came from higher prices for soft drinks (up 9.6 percent), prepared meats and smallgoods (up 7.4 percent), and bread (up 4.7 percent).

The most significant downward contributions came from lower prices for potatoes (down 31.9 percent), cheddar cheese (down 21.5 percent), and apples (down 22.9 percent).

Although food prices are now 0.9 percent higher than a year ago, they are 11.4 percent higher than two years ago.

 

Fruit and vegetables

Prices for the fruit and vegetables subgroup decreased 2.0 percent in November 2009, following decreases of 4.6 percent and 8.4 percent in October and September 2009, respectively. A fall in vegetable prices (down 6.3 percent) more than offset a rise in fruit prices (up 4.5 percent). Fruit and vegetable prices, which usually fall over the spring months, are now down 17.2 percent from their winter peak in July 2009.

The most significant downward contributions to the November 2009 fall came from lower prices for tomatoes (down 33.0 percent), broccoli (down 51.5 percent), and strawberries (down 33.0 percent). Prices for these items usually fall in November months. The most significant increases came from nectarines (up 100.0 percent), carrots (up 21.7 percent), and potatoes (up 9.2 percent). Nectarine prices usually peak in November months.

For the year to November 2009, fruit and vegetable prices decreased 7.6 percent. This is the largest annual fall in fruit and vegetable prices since they fell 7.7 percent in the year to September 2005. Annual falls for fruit and vegetable prices have been recorded for the past four months. Vegetable prices were down 9.1 percent and fruit prices were down 5.4 percent for the year to November 2009. This was the largest annual fall in fruit prices since they fell 7.6 percent in the year to February 2008. (Note the fruit and vegetables subgroup was seasonally adjusted until the June 2006 month. All historical references are to seasonally unadjusted prices.)

The most significant downward contributions to the annual fall came from lower prices for potatoes (down 31.9 percent), apples (down 22.9 percent), and broccoli (down 40.0 percent).

Other subgroups

Slightly lower prices were recorded for the non-alcoholic beverages (down 0.8 percent) and grocery food (down 0.2 percent) subgroups. Higher prices were recorded for the meat, poultry, and fish subgroup (up 0.1 percent) and the restaurant meals and ready-to-eat food subgroup (up 0.6 percent).

For the first time this decade, the grocery food subgroup decreased four months in a row. Grocery food prices have returned to about the same level recorded in May 2009.

Within these subgroups, the most significant downward contributions in November 2009 came from lower prices for minced beef (down 8.7 percent) and coffee (down 9.2 percent). The most significant upward contributions came from higher prices for bacon (up 5.8 percent) and takeaway salad (up 14.4 percent). The rise in takeaway salad followed a fall (down 11.9 percent) in October 2009, where there was significant specialling.

The most significant downward contributions for the year to November 2009 came from cheddar cheese (down 21.5 percent), fresh milk (down 4.7 percent), and butter (down 30.6 percent). The most significant upward movement for the year to November 2009 was soft drinks (up 9.6 percent).

For technical information contact:
Yvonne Fakahau or Daniel Griffiths
Wellington 04 931 4600
Email: info@stats.govt.nz

Next release ...

Food Price Index: December 2009 will be released on 20 January 2010.