Wed, 11 Nov 2009 5:43p.m.
By Adam Ray
There was more evidence today about what's happening to food prices, and more dark muttering about what the supermarkets are up to.
Overall the price of food dropped 1.5 percent last month, as measured by the Government's Department of Statistics. And it noted that for the first time this decade prices fell in all five of the food factors that it monitors.
It also confirmed that though prices are currently falling, they're still higher than last year, and much higher - 12 percent or so - than the year before that.
What's rising dramatically are some of those grocery items like broccoli, carrots, and in the case of cabbage a whopping 53 percent.
And that's where the muttering about supermarkets starts - with the fruit and vegetable suppliers saying the rise in prices and profits certainly isn't being passed on to them.
Fruit and vegetable growers say it's a gloomy time for their industry. They say the money they get paid for their produce hasn't grown for a decade.
"It's a very difficult place that they're in there, and they're really feeling under pressure," says Tony Silcock, Horticulture NZ.
Horticulture NZ says that supermarkets and other buyers have refused to pay more, but want more in return.
"Particularly supermarkets are becoming more demanding," says Mr Silcock. "Different delivery times, conditions around packaging."
Farmers aren't happy either. They say about one quarter of the price consumers pay for what's on the shelf actually makes it back to the farm.
"They certainly are being squeezed effectively," says Federated Farmers' Don Nicholson. "We're the residue receiver - we get what's left after everyone has taken their cut, and some years that's not enough to break even, actually."
Two major players - Foodstuffs and Progressive - dominate the supermarket business. Foodstuffs say that fresh produce price increases have been relatively modest in the past decade, and that margins are small, "and that hasn't changed over the past decade, so I am surprised and a little bewildered by those comments".
But the growers say supermarkets aren't playing fair. All the growers approached by 3 News refused to go on camera, telling us the supermarkets would blacklist them if they did.
Although they wouldn't go on camera, one grower says supermarkets treat them almost like slaves, while another describes supermarkets as the bullies of the rural world.
Foodstuffs says it has a good relationship with its major suppliers, but that it always tries to pay the lowest prices.
"Obviously some of the smaller ones feel bullied," says Tony Carter. "Clearly we have a responsibility to get the best prices to pass onto our consumers."
Produce growers say it's time for a Government inquiry into supermarket pricing.
3 News
