Gareth Kiernan: Grocery prices up last month

New data from Infometrics and Foodstuffs show costs from suppliers to supermarkets rose by 2.7% in June. 

Costs were up in all departments compared to last year, with around 2,000 items up in price from May to June. 

Infometrics Chief Forecaster Gareth Kiernan joins Ryan Bridge to discuss why. 

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Episode Transcript

Speaker 1 (00:00):
New grocery data from Infometrics and food stuff costs from
supplies to supermarkets rose by two point seven percent in June.
Costs in all departments ruped this year compared to last year,
and around two thousand items increased in price between May
and June. Joining men Ows and for Metrics chief forecaster
Gareth Cannon, Gareth, good morning. Forgive me, Gareth, I've got

(00:25):
to turn you on myself. Gareth, Gareth, good.

Speaker 2 (00:29):
Morning, right, yes, yeah, keeping problems on the first day.

Speaker 1 (00:33):
Yeah, sorry about that. Good to have you on the show.
So tell me why is this still going up?

Speaker 2 (00:40):
There are still a few pressures coming in from overseas
which have affected things in the last month. We're still
seeing higher prices for cooking oil, coffee, chocolate, those sort
of things. And there are also a few higher produce prices,
a few fruit rising and price this month as well.
But I guess the key trend is, Look, we're not
seeing the same extended price rises that we're getting eighteen

(01:02):
months ago when the index was up more than ten
percent on a year ago. So it's been moderating over
the last twelve months or so and we're continuing to
see that trend happening.

Speaker 1 (01:11):
Is that is that coming down at a steady pace
or is it Are you seeing a sort of a
reacceleration of some of these items.

Speaker 2 (01:21):
There's a few individual items in there, but the overall
index is can it continuing to come down at a
fairly steady pace. It's still sitting I guess the growth
rate is above what we saw pre COVID, where prices
or costs were rising it you know, sort of one
to two percent random So we're hoping for more moderation
to be coming through. But there are still a few
little bits of sort of stickiness and in terms of

(01:42):
some of those prices.

Speaker 1 (01:43):
Yet how important are these prices for the prices that
we pay at the supermarket?

Speaker 2 (01:49):
Yeah, there are a significant component, of course of what
ends up the cost coming through you in terms of
what you're paying at supermarket. They're not everything. Labor costs
and you know, commercial rent costs and electricity all those
sort of things also feed through into the costs that
supermarkets face and therefore the price that they charge you
as well.

Speaker 1 (02:09):
Do you have any indication, I mean, are you are
you able to take these numbers and put them into
a fancy graph and then work out when this will
actually start coming down, you know, or perhaps even turn
the other way and go negative.

Speaker 2 (02:25):
Yeah, we're not expecting it to go negative. I guess
what we've seen across the whole economy is that what
we've had over the last two or three years through
the pandemic and the sort of aftermath of that, is
that you've almost had a step up in the level
of prices overall, and I think food prices are not
immune to that either. We are expecting now, I guess
over the rest of the course of this year and

(02:46):
into early twenty twenty five that the sort of last
little bits of inflation that are still causing problems in
the system, that they will sort of be weeded out
and you will get price growth back to what we
were used to prior to Covida.

Speaker 1 (02:58):
Thank you very much for your time this morning, right
to heave you on the program sixteen minutes half to find.
That was Gareth Kennan, informatric's chief forecaster. For more from
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