• Stats NZ records 3.5% annual food price inflation (FPI) in March 2025 
• Foodstuffs co-ops report 2.8% year-on-year rise in retail prices for goods in their FPI basket 
• US-China trade war impacts yet to be felt but shipping and market disruptions expected 
• Butter up 64% YOY due to global demand and lamb legs up 72% as a result of Easter timings 

Latest statistics shows food price inflation in New Zealand is trending upward, with the Foodstuffs co-ops expecting shipping and market disruptions from the US-China tariffs over coming months. 

Stats NZ today reported an annual food price inflation (FPI) rate of 3.5% in March 2025, while the Foodstuff co-ops recorded an average 2.8% year-on-year rate for their comparable FPI basket. 

The Foodstuff co-ops have been monitoring FPI across their 500+ stores – including every New World, Four Square and PAK’nSAVE – since mid-2022, measuring the prices of a basket of goods in the same categories that Stats NZ monitors, using the same methodology and weightings. 
 
Foodstuffs NZ Managing Director Chris Quin says while annual FPI has been between 1-3% for the past six months, Stats latest result suggests an upward trend that’s occurring overseas too. 
 
“Global supply and demand and geopolitical events play a huge part in New Zealand food prices,” says Quin. “World Bank data shows food commodity prices are still more than 25% higher than five years ago, in March 2020, when the Covid crisis began, and now we have a new challenge in the form of a trade war between China and the US.” 
 
“Our co-ops’ logistics teams say shipping costs, which have been favourable into New Zealand over the past year have now reached the bottom and likely to go up. Uncertainty in trade due to the new tariffs will likely have consequences, with schedules disrupted and shipping costs rising. 
 
“Until now, China and the US have been buying billions of dollars a year of each other’s food exports. Hefty tariffs mean those goods are now likely to be diverted elsewhere. How that affects our customers remains to be seen – it could push some food prices up and others down. 
 
“Our buying and logistics teams will be working hard to get the best prices on behalf of our 500-plus local store owners and their shoppers, which is why our co-ops formed in the first place.  
 
“Of course, March’s FPI figures pre-date the latest tariffs, and key drivers behind our co-ops’ 2.8% rate included a -5.7% decrease for produce versus a 5.6% increase for meat, poultry and fish. At a product level, the biggest year-on-year increases were 64% for butter and 72% for lamb legs. 
 
“There’s a lot of pressure on retail prices for butter, cheese and milk due to global demand for our milk solids. The Global Dairy Trade index is now almost 50% higher than just 18 months ago. So, while we celebrate the benefit of that for the wider economy, it does affect local prices.” 
 
“Lamb leg prices were up in March too, thanks to strong offshore demand but also as a result of the difference in the timing of Easter this year, and the sharp deals we offer in the lead up to it.  Last year it was in March, whereas this year it’s in April, hence the price difference, year-on-year.” 
 
Foodstuffs’ supplier costs rose 3.3% in March (YOY) for goods in the co-ops’ FPI basket. Earlier, Infometrics reported a 2.0% annual rise in the Grocery Supplier Cost Index, across 60,000 goods. Supplier costs comprise an average two-thirds of the shelf price of goods at Foodstuffs’ stores. 
 
“Our produce specialists say values have been good, with no shortages. Colder weather is setting in, though, which could see some prices rise. Ongoing dry conditions in the east and north of the North Island will impact some crops down the track, however the recent rain should help.”