Grocery supplier costs for supermarkets once again grew in March 2023, marking six months where the average supplier cost increase has been above 10% per annum.
The Infometrics-Foodstuffs Grocery Supplier Cost Index (GSCI), which tracks changes in supply costs, recorded a 10.3% increase in comparison to one year ago.
The index, which utilises data across over 60,000 products, says 5600 items increased in cost in March 2023.
The figure is four times greater than in March 2020, however it is smaller than the 8200 items that rose in cost in February 2023.
In a statement, Infometrics chief executive Brad Oslen said producers and others down the supply chain are "still facing intense and sustained input cost pressures”.
"Supplier cost increases continue to be broad-based across all departments in March, with produce costs from suppliers to Foodstuffs still up more than 20% from a year earlier," he said.
"Frozen foods and grocery goods also saw an acceleration in supplier costs, with dairy products, frozen vegetables, breads, petfood, and eggs all seeing larger increases."
Price jumps were recorded in every grocery department, the highest being in produce which averaged a 21% rise in cost, followed by frozen foods, seafood and service delicatessen at 13%, 12% and 10% respectively.
The smallest increases were seen in liquor, which climbed just under 4%, while tobacco and bulk foods jumped approximately 5%.
Olsen elaborated on supply impacts following Cyclone Gabrielle, saying the recorded 21% costs increase for produce "underestimates the full increase in produce costs, with a number of fresh produce cost increases being outside the parameters of the index - an unusual situation brought about by the cyclone".
He added that additional analysis showed "large increases in apples, pears, potatoes, kiwifruit, and kumara in the wake of Cyclone Gabrielle. Some of these increases are not fully captured in the GSCI due to the way Infometrics excludes cost changes over a certain magnitude for data quality purposes."
Every month the index tracks what costs supermarkets pay to put goods on shelves, previous analyses indicating supplier costs are the major component of on-shelf prices, representing two-thirds of products' costs.
In February 2023, supply costs climbed 10.4% in contrast to a year earlier, with produce seeing a similar jump of 23%, and frozen foods, seafood and butchery saw upticks of at least 10%.
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