New Zealand potato prices reach record high as COVID-19 affects industry

Statistics New Zealand has stated that prices rose 18 per cent in April to a weighted average price of $2.51 per kilo – an all-time high. Going into the winter months is typically the cheapest time to buy potatoes, with the Christmas period being the most expensive.

Some media reports suggest the potato industry has seen a 30–50 percent increase in demand from supermarkets and a shortage of workers.

“Higher demand and a shortage of potato pickers, many of whom stayed home due to fear of the COVID-19 virus, could explain this large price increase,” consumer prices manager Bryan Downes said.

Food prices increased 4.4 percent to the year ended April 2020, the largest annual movement in over eight years. This rise was influenced by higher prices for grocery food (up 4.2 percent), meat, poultry, and fish (up 6.2 percent), and non-alcoholic beverages (up 4.7 percent).

Potato prices increased 38 percent in the year, the largest contributor to the annual rise in food prices.

Potatoes NZ has reacted to the reported ‘record high prices’, calling the above mentioned figures ‘skewed’, since Stats NZ is reporting on a month when supermarkets were the only source of food.

“This means the price is very much skewed compared to usual scenario. Normally the average price would include all retail outlets & therefore be lower,” says Chris Claridge, Chief Executive of Potatoes New Zealand. “Farmers are not getting more bang for their buck. Consumers are not paying 18% more for spuds.”

According to a Potatoes NZ spokesperson, they have already attempted to convey this to Stats NZ.

Stats NZ reacted saying they double-checked the higher prices for potatoes and are confident that consumers were, on average, paying more in supermarkets in April.

The retail price of potatoes is collected from stores, with the cheapest available option collected, and a unit cost-per-kg calculated.

Since Stats NZ only collects the retail price, they can’t say if potato growers were getting more or less for their produce, or if supermarkets or other wholesalers may have taken a different profit margin.

Vegetable prices may have been affected by a lack of competition in the month because only supermarkets were trading under lockdown.

But because shoppers had no choice in April but to shop at supermarkets, the prices Stats NZ collected reflected the reality for households.


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