This rising food prices has been making headlines for a decade. But prices will not be rising evenly across all food groups – and that has serious health implications for New Zealanders.
Last week, NZ statistics were released food price data showing the biggest price drop in six years. The second quarter consumer price indexwhich launches today will provide a broader take a look at the inflationary pressures facing New Zealanders, including the cost of food.
Despite recent price declines, concerns about food security, food affordability and the dietary quality of the local weight loss program remained the same.
While the rise in food prices has been noticeable over the long run, the change in relative prices—the cost of one food category in comparison with one other—often goes unnoticed. Nevertheless, these relative price changes are key because they influence consumer selections, often subconsciously.
Our recent research analyses Stats NZ price data from 2014 to 2023 for 85 food items collected from 560 shops – supermarkets, greengrocers, fishmongers, butchers, convenience stores, restaurants, and breakfast, lunch and takeaway outlets – across 12 metropolitan areas.
Between July 2014 and March 2023, the prices of some sweetened, processed foods and drinks, similar to cartoned chocolate, ice cream, sodas and energy drinks for sports, increased by about 14%. During the same time, the prices of some fruits and vegetables increased by about 45%.
When sugary processed foods are cheaper in comparison with fruits and vegetables, People are likely to buy more of the former. This can result in poor eating habits, increasing the incidence of obesity and related health problems.
Ildar Abulkhanov/Getty Images
Exceptional aspects cause slower price declines
Although food prices have increased globally since 2020, mainly because of the COVID-19 pandemic and geopolitical tensions, many countries have seen the following food price inflation is fallingAs the latest data from Stats NZ shows, this is beginning to occur in New Zealand too.
However, price inflation in New Zealand has been higher and more persistent than in many other developed countries, suggesting that unique aspects could also be necessary.
The structure of the food retail sector, dominated by Foodstuffs and Woolworths, has change into more visible as food prices have risen. The lack of competition tends to result in higher prices.
However, given how long the duopoly has dominated the supermarket sector, this alone doesn’t necessarily explain the absolute and relative price changes revealed by our research.
Due to increasing regional specialisation, the New Zealand fresh fruit and vegetable supply chain is particularly vulnerable to disruption from extreme weather events.
While specialization improves production efficiency, it increases vulnerability to local shocks like Cyclone Gabrielle. This is exacerbated by a sparse transportation network.
International trade also affects the relative prices of differing types of food. The composition of New Zealand’s production and exports is differs significantly from imported products.
New Zealand doesn’t produce sugar beets or sugar cane, making it entirely depending on sugar imports, for instance. On the other hand, most of the fresh fruit and vegetables consumed in New Zealand are grown domestically.
These aspects can affect the production and cost of different food products, resulting in divergent prices. Access to multiple sources of imported food can reduce price volatility, while regionally concentrated domestic supply may cause wild swings in food prices.
Food prices are a health problem
The growing price gap between processed foods and healthy foods is not only a problem of access. It has significant health implications.
One in three adults in New Zealand was obesity in 2020-2021and childhood obesity is also on the rise. The prevalence of diabetes has risen from 35.7 per 1,000 people in 2012 to 41.5 per 1,000 people in 2021.
Moreover, the number of diabetics is Growth is expected by 70-90% over the next 20 years, and the annual cost of treating diabetes could rise from NZ$2.1 billion to $3.5 billion over the same period.
Even more worrying is that these burdens will not be distributed evenly across New Zealand society.
Poor weight loss program disproportionately affects indigenous people and those from lower economic backgrounds. Pacific people and Maori have lower average incomes AND higher obesity rates than New Zealanders of European descent.
Low-income families have long discovered this It’s hard to afford it and follow a healthy weight loss program because of the rising prices of fruits and vegetables.
A multi-pronged strategy is needed
The increasing relative affordability of sugary foods poses a serious threat to the health of New Zealanders. Without intervention, the country could face a rise in diet-related chronic diseases, straining an already strained health system.
To reverse these trends and promote higher nutrition and health for all New Zealanders, a comprehensive approach is needed, including economic, educational and regulatory measures.
Must be multi-track strategy to deal with the complex challenges facing our food system. This must include taxes on sugary foods in addition to subsidies for fresh produce, banning junk food marketing to children, tackling food insecurity and investing in free school lunches.