NZ Grocery Prices Skyrocket as Global Demand Drives Up Costs

A recent social media post has sparked interest in a 1991 grocery receipt from Woolworths, comparing prices then to now. The receipt listed items that would cost $63.75 in total, including milk, butter, bread, eggs, Weet-Bix, coffee, and sugar.

When the same items were priced at a local Woolworths store this week, the total came out to be $93.17, nearly $20 above the inflation-adjusted figure of $73.57.

Economists point out that this price gap is not just a curiosity for households but also a significant concern for employers. Massey University economics professor Christoph Schumacher notes that New Zealand's success as an exporter has led to producers setting domestic prices based on global demand, which in turn contributes to higher costs for consumers.

The issue of affordability affects low-income households the most, with those in hospitality, retail, food service, logistics, care, and manufacturing sectors being particularly exposed. The Commerce Commission found that the average household spent $214 a week on groceries, 13% of total spending, in the year to June 2023.