Food inflation

November 14th, 2013 at 11:00 am by David Farrar

Stuff reports:

Statistics New Zealand also measures the cost of a standard supermarket trolley full of grub over time – called “food price inflation”.

That index has jumped by one third over the last 10 years, and led to a 25 per cent drop in our purchasing power.

have indeed gone up 33% in the last ten years, but I’m not sure about that figure for a drop in purchasing power as after tax incomes have gone up more than that.

It is useful to break the 33% down by year. For each year to October, food inflation was:

  • 2004 – 1.1%
  • 2005 – 1.1%
  • 2006 – 4.0%
  • 2007 – 3.6%
  • 2008 – 9.9%
  • 2009 – 2.0%
  • 2010 – 5.1%
  • 2011 – 1.1%
  • 2012 – 0.3%
  • 2013 – 0.8%

So from Oct 05 to Oct 08, food prices increased a massive 17.5% approx. In the last 36 months they’ve gone up 2.2% only.

 

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34 Responses to “Food inflation”

  1. nasska (12,095 comments) says:

    Surely not 17.5% inflation up to 2008 DPF. That would mean that Labour who defend the poor workers & beneficiaries did nothing to protect the buying power of their voters.

    There must be some mistake. :)

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  2. burt (7,425 comments) says:

    nasska

    That’s what happens when the government spends like a drunken sailor – inflation goes crazy…. Yet people still believe in socialism even when it fails so drastically time and time again. The dim-bulbs will vote for more government spending because they are too stupid to remember that last time they had that it impacted them negatively.

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  3. nickb (3,696 comments) says:

    Food inflation under a 2014/2017 Labour/Greens/Maori/Mana/NZF/UF Coalition?

    1500%. Billion dollar notes can buy an ice cream. Willie Apiata called in to ration toilet paper in supermarkets. Territorials called in to stand guard at petrol stations.

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  4. burt (7,425 comments) says:

    nickb

    Rubbish – once we legislate a higher minimum and a living wage and print more money we’ll all be millionaires !!!!!!

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  5. wikiriwhis business (4,200 comments) says:

    ok, the first reflection is obviously the living wage. soon as wages go up prices go up. We all back to square one.

    There needs to be a price freeze so Kiwi’s can pad themselves. The scrutiny of bank fees is a great start.

    Business in this country have no idea of how economics work. They just dive into the consumers pockets as fast as they can to rape wallets with no consideration for the bigger picture.

    If the consumer were allowed to fill up and breath and get confidence into their personal affairs they would spend when affordability presents itself.

    Overtaxation is the epitome of business greed. That lies directly at the feet of govts. All stemming no doubt with the Reserve Bank’s endless futile fight against inflation which has probably and obviously in this case, been just as much a red herring as the failed war on drugs US citizens have spoken out against enmasse.

    Over regulation stemming from govt and Reserve Bank hegemony really does need to be addressed but the first to speak out wil be the first to be executed by the corporate owned media and disqualified.

    Roger Douglas was desribed in the Herald as a proponent of classical economics. A buzz term for Keysnian which the Herald directly side stepped to identify. Because keysnian economics is a world wide failure western govts are globally intent on pursuing to promote a global govt out of the ashes of the old world order. And that construct is the reason for devaluation of the dollar and the imminent collapse of the dollar.

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  6. dubya (245 comments) says:

    nickb, don’t tell lies. Ice cream will be banned by the Greens. All confectionery will be confiscated and delivered to the ministerial home of one M. Turei for immediate destruction.

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  7. BeaB (2,164 comments) says:

    I bet we hear that awful man Cunliffe raving on about the cost of fruit and veg and how we can’t afford to feed our families. What hypocrites Labour are.

    Sadly the Left are the more virulent haters and their story tends to be parroted by the media and by all the hangers-on in charities, NGO’s etc that depend on these myths for their livelihoods.

    For instance, the Left vilify Banks and Dunne but we won’t hear a peep from them about Claire Curran wrecking reputations hiding behind Parliamentary privilege. She is a disgrace.

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  8. Samuel Smith (276 comments) says:

    It’s hard to understand why food, especially the basics, costs anything.

    Surely fruit, vegetables and many other foods are a public good.

    Charging for food places a disproportionately high cost burden on everyone except the wealthy few.

    It is time for a total re-think on issues like charging for food, electricity and health care.

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  9. wikiriwhis business (4,200 comments) says:

    My point exactly Samuel Smith

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  10. nickb (3,696 comments) says:

    Lmao dubya.

    The aptly named SS pumps for Communism again. How utterly predictable.

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  11. Samuel Smith (276 comments) says:

    @nickb – It’s common sense. Just make sure everyone is fed and healthy.

    Why should some people struggle through life hungry in a nation with large food production capability?

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  12. dubya (245 comments) says:

    You are a muppet, Samuel. Basically every other animal somehow works to get its food. Most humans included. A notable exception is the female Bonobo monkey, who sleeps with every male in the community and gets them to bring her food for her baby, the parentage of whom remains a mystery.

    Not unlike the modern welfare female your ilk seem to champion, I might add.

    Perhaps you will argue being a bludging slut is work, though.

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  13. Sir Cullen's Sidekick (899 comments) says:

    I believe the evil John Key could have been in power during the period Oct 05 to Oct 08……that is what Labour MPs will make you believe and NZ Herald and John Campbell will also agree….

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  14. alloytoo (582 comments) says:

    @ Sammy

    TANSTAAFL

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  15. Yoza (1,926 comments) says:

    This is vary dishonest, even by Kiwiblog standards. 2007-2008 food price inflation was a global phenomena, as I am sure David Farrar is aware, it would not have mattered who was in power at the time. The increase in food prices was driven by financial speculators and prices collapsed as those institutions gambling on them were weeded out during the global financial crisis.

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  16. wikiriwhis business (4,200 comments) says:

    I getting the feeling there are many on KB who actualy believe there has never been a devalued dollar and we still live in a 1980’s economy. Life’s good for some. and they fighting to keep it that way for themselves. To every one else’s detriment

    yoza…12.30…… hammer,nail,hit!

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  17. burt (7,425 comments) says:

    Right – so that was a global phenomena – but the surpluses and the like under Labour were noting to do with the global golden weather – they were Labour’s policies – right ?

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  18. nickb (3,696 comments) says:

    Hey SS / Wiki

    How did you free food utopia work out in the USSR, China, North Korea and Cuba?

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  19. wikiriwhis business (4,200 comments) says:

    No one’ talking about free food nickb. You just happen to be amongst the trivialist culture of this country

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  20. burt (7,425 comments) says:

    wikiriwhis business

    Of course it’s not free – other peoples money subsidises it !

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  21. wikiriwhis business (4,200 comments) says:

    Food for schools is in Burt. Get over it

    and answer the q to you

    Why should some people struggle through life hungry in a nation with large food production capability?

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  22. redeye (633 comments) says:

    With the exception of dairy most food producers in this country have struggled for years to produce an income even remotely deserving for their investment, in both labour time and capital.

    Idiots like ss and whirlygig would drive more of them into the more productive industries like consulting and legal.

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  23. Judith (8,534 comments) says:

    It is important to note the items that are included in the ‘standard’ supermarket trolley measurement – one of which is white bread.

    It doesn’t make sense that white bread is cheaper than full grain bread, after all there are extra actions that must be undertaken to make pure white flour. Commonsense dictates that the more natural the product, the less processes it must go through, the cheaper it should be. That is not so.

    The price of the bread that I buy has risen by 8.2% in the past year. The equivalent size in a white bread has gone from $1.58 to $1.60.

    You won’t find many of the food items I purchase regularly in the ‘standard’ supermarket trolley. You also wouldn’t be having this discussion if you took the rate of inflation on the primarily healthy food products I buy. The food industry has simply responded to the market. People that can afford to, and are wise enough to eat healthy food, will pay for it despite the price rises, the rest must eat the alternative, which must remain significantly cheaper in order to make a sale. The true price exists somewhere in the middle, as does the rate of inflation – IMO.

    Having said that, the government has done well to keep inflation down considering the global environment.

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  24. gump (1,683 comments) says:

    @burt

    “That’s what happens when the government spends like a drunken sailor – inflation goes crazy…. Yet people still believe in socialism even when it fails so drastically time and time again”

    ———————

    Inflation didn’t “go crazy”. The CPI averaged 2.7% during the 2000s.

    http://i.imgur.com/OXywN4v.jpg

    The prices of food rose during the 2000s because of rising global demand for commodities. It provided a huge benefit to our farming sector.

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  25. Ed Snack (1,939 comments) says:

    Some absolutely fabulously clueless comments here today. Congratulations to wiki, sam, and yoza for witless total non-comprehension of economics.

    And just to add to the informationless, the 2008 or so food price spike was largely caused by the diversion of food crops into biofuel production because of subsidies provided by governments for that at the behest of the lunatic green and climate change denier (they deny that climate can change without human intervention) lobby. This still has a significant impact on corn prices. The starvation and deaths from this are directly the responsibility of those promoting biofuels.

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  26. wikiriwhis business (4,200 comments) says:

    Ed Snack

    I absolutely believe business greed leads to money grabbing when wages rise. Govts sit by and watch it happen and raise GST to perpetuate poverty.

    and let’s not forge the vested interests so many corporate Kiwi Bloggers have in belonging to political and corporate agendas.

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  27. Ed Snack (1,939 comments) says:

    Wiki, I’m sure you do believe it, it’s just that it is a highly distorted and not useful view. How does “business greed” lead to money grabbing ? If wages rise, most if not all businesses find that their costs increase, are you suggesting that should just “suck it up” and make losses if necessary to do so ? Aren’t increasing wages just the same sort of greed as well ?

    Governments “just sit by”, what should they do, you suggest above a price freeze, have you any idea how stupid that is ? Were you around in the early 1980’s when Muldoon tried that tactic, I was ? It failed badly, it locks in inequities, prevents innovation and favours stagnation and inaction. I’m a competition believer; you want to keep prices down as far as is possible, promote genuine competition, businesses will fall over themselves to be competitive which may mean lower prices or some combination of better service, better products, and better prices. The market then is just you and everyone else participating having their say in who is successful, and no one has to force you to do it.

    Can I suggest reading some Adam Smith, especially parts of his “The Wealth of Nations”. This quote is often used : “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.” and it contains an essential truth about people and how they interact.

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  28. Yoza (1,926 comments) says:

    Speaking of nonsense …

    Ed Snack (1,192) Says:
    November 14th, 2013 at 3:41 pm

    And just to add to the informationless, the 2008 or so food price spike was largely caused by the diversion of food crops into biofuel production because of subsidies provided by governments for that at the behest of the lunatic green and climate change denier (they deny that climate can change without human intervention) lobby. This still has a significant impact on corn prices. The starvation and deaths from this are directly the responsibility of those promoting biofuels.

    The drive to divert corn to bio-fuel was driven by sky rocketing oil prices and the US’s desire to be less reliant on foreign imports of oil. The prospect that bio-fuels were driven by environmental concerns is laughable.

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  29. nasska (12,095 comments) says:

    Yoza

    ….”The drive to divert corn to bio-fuel was driven by sky rocketing oil prices and the US’s desire to be less reliant on foreign imports of oil.”….

    Bollocks. The push to bio fuels came from the commie UN & the wanking Greens. Although mercifully the win by the National Party in 2008 stalled attempts to introduce a compulsory percentage of renewables in our fuel the move was pushed on a world wide basis.

    Ref: http://www.biofuelsdigest.com/bdigest/2011/07/21/biofuels-mandates-around-the-world/

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  30. Ross12 (1,484 comments) says:

    ” The prospect that bio-fuels were driven by environmental concerns is laughable” Absolute garbage.( just like your link that goes to a 404 page). It was put in to reduce so called fossil fuel useage to reduce emissions at the behest of the Green lobby.
    And now look whats happening:

    http://www.sfgate.com/business/energy/article/Prairies-vanish-in-the-US-push-for-green-energy-4977288.php

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  31. Alan (1,087 comments) says:

    “So from Oct 05 to Oct 08, food prices increased a massive 17.5% approx. In the last 36 months they’ve gone up 2.2% only.”

    What about the two year period between the 2 you highlighted? What is the logic of removing it?

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  32. OneTrack (3,360 comments) says:

    “There needs to be a price freeze so Kiwi’s can pad themselves. The scrutiny of bank fees is a great start.”

    So the state should direct private companies as to what their prices are? Maybe the state should tell them what to make as well?

    Yay, Muldoons back. That worked so well.

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  33. OneTrack (3,360 comments) says:

    “Charging for food places a disproportionately high cost burden on everyone except the wealthy few.

    It is time for a total re-think on issues like charging for food, electricity and health care.”

    Sam, you want to repeat history and put us on the path to a communist nirvana? Because that ideology ALWAYS works out so well. And when people are queuing down the streets waiting for their load of bread, will a little self doubt appear in the back of your mind. Or are we special kiwis, and the same problems just wont happen to us?

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  34. OneTrack (3,360 comments) says:

    “Why should some people struggle through life hungry in a nation with large food production capability?”

    Why do those people waste their ample benefit payments and Working for Families payments on drugs and booze instead of feeding their kids? How can people struggle through life hungry and be obese at the same time (through eating too much evil american corporations products)?

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