Liam Dann: NZ Herald business editor at large on dairy products driving a spike in food prices

Butter, cheese and milk were the biggest drivers of a rise in food prices for the year to April 2025, new figures from Stats NZ show.

Food prices increased 3.7 percent in the 12 months to April - well ahead of the annual inflation rate at 2.6 percent.

That follows a 3.5 percent increase in the 12 months to March 2025.

NZ Herald business editor at large Liam Dann explains what's going on.

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Episode Transcript

Speaker 1 (00:00):
Now we've been speaking about the price of dairy earlier
in the program's been going up quite a bit, driving
the food costs higher. In the last year or so,
food prices up three point seven percent over the last year,
Milk up though fifteen percent, cheese up twenty four percent,
butter up sixty five percent. Liam dann as The Herald's
Business editor at large air Liam goot A, Heather, I
mean it hurts, but we also see the good side

(00:21):
of this, which is that our farmers are making some
money for the country, right.

Speaker 2 (00:24):
Yeah, Well, I mean I always do. I'm always pleased
to see dairy prices booming. I know, it's you know,
these rises weren't surprising any of the king bakers and
people who are using a lot of butter, because there's
been peny of stories about it going through the roof.
But you know, and of course I had a look
on Facebook and everything on the story and all the
comments at the bottom are you know, why do we

(00:46):
have to pay so much when we make it here?
And I can't help thinking do we make it or
do some you know it's Sponterra is still a company
of you know, and the farmers are getting up at
five in the morning. They're making it when you know,
we can't tell them to sell to us cheaper. They
can get a better price in China and they can
get a better price in China right now, So that
that's driving it up a little bit more. I think

(01:09):
on the you know, pointing towards where the inflation numbers
are headed, it's a little it was a little bit
more than the economists would have liked to have seen today.
They you know, there's some other prices we can't control,
like coffee prices were up about twelve percent, twenty one
percent for instant coffee drinkers. That's not much fun. But

(01:29):
you know, there's still the economists resonably confident that, you know,
because of the real downturn in the core of the economy,
that the inflation isn't going to go back to those
high levels and this temporary and you're going to see
or non tradable inflation continuing to fall to balance it

(01:52):
all out.

Speaker 1 (01:53):
Now, Liam, I see that the airfares, and I did
make this point are in the program. The air fees
have drawn attention again because the international airfares for them
just in April compared to March went up by twenty
five percent. That's, of course because there were school holidays
and you know, Easter and blah blah blah. But now
the obvious assumption is that the airlines have hiked the
price for the school holidays. But is it also not
possible that it simply is as more people book, the

(02:15):
supply and demand algorithm casina drives the prices up.

Speaker 2 (02:19):
I guess, you know, there's been that shortage of planes
and so on, but I would say, you know, fuel
prices are quite significantly down that they've been a good
you know, going in the right direction. So you know, yeah,
look as a dad who's booked all his overseas holidays
just recently during the school you know, and I have

(02:41):
to go during the school holidays. Yeah, it's a lot
still at school.

Speaker 1 (02:45):
I thought they were at UNI.

Speaker 2 (02:47):
Two of them are still at school. And my wife's
a teacher, so I can't get around them. You know.
That's what you don't think about when you think about
the teachers having all those holidays as they can't get
the cheap airfis they've got to go win its a
school holidays?

Speaker 1 (02:57):
You know what that is?

Speaker 2 (02:58):
A what's that?

Speaker 1 (03:00):
As a first world problem.

Speaker 2 (03:01):
That's a first world problem. It absolutely is. Yeah, no,
I'll accept that.

Speaker 1 (03:06):
Liam. It's good to talk to you as always. Thanks man,
Liam Dan, General Business Editor at Large.

Speaker 2 (03:12):
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