Chris Quin: Foodstuffs North Island CEO on the impacts of tariffs, rising food prices and inflation

The "guessing game" continues over how New Zealand will be affected by new tariffs around the world.  

Data —due out tomorrow morning— is expected to show inflation has risen for the first time in almost three years. 

Contributing to that is the food price inflation rate, which has risen from 2.8% to 3.5% in just the past month. 

Foodstuffs North Island Managing Director Chris Quin told Mike Hosking two factors could push prices higher or lower. 

One is the availability of products, the other is global shipping patterns. 

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Episode Transcript

Speaker 1 (00:00):
Yeah, you got that.

Speaker 2 (00:01):
You wouldn't have said that a couple of months ago,
would you now back home? Speaking of things to sell
to people? What about the supermarket and the prices and
the food price inflation annually three point five Does this
add to the general sense that a bit of pressure
might be going back on overall inflation picture. That official
number comes out tomorrow, of course. Foodstuffs New Zealand managing
director Chris Quinn back with us, very good morning, Good morning, Mike.

(00:22):
As regards price increases three and a half percent. Have
we got a brewing issue here? Is inflation back or not?

Speaker 1 (00:28):
Look, it is definitely an up tour on what we've
seen so far this year. But there are a couple
of key causes in this one. So the food price
inflation number was three point five percent, our retail increases
only two point eight, so we're doing something to manage that.
But the big drivers right now were butter prices in
land legs in but are obviously what's going on with

(00:50):
dairy and the global dairy trade. Pricing, which is fantastic
for our economy, obviously does still flow through to local
prices of products made from dairy And the other thing
for the month of March is that lem leads because
of the shift of Easter, so the production and promotions
on those shifted from March to April. So that's a
couple of the key causes in behind this. There's a
lot of other products that have continued a nice flat,

(01:12):
you know, one to three percent sort of.

Speaker 2 (01:15):
Increase if you wanted to be healthy. And this is
sort of off topic, but nevertheless, what I'm looking at
is fruit and veggies are down. Tomatoes and cabbage are
particularly down. Meat, poultry and fishes flat. So if you
want to eat well and avoid chocolate and all of that,
you can do so, and the price isn't going through
the roof.

Speaker 1 (01:33):
That's right, And that's probably the best news about the
last twelve months is that the fresh products that you know,
people would like to be adding more of than have
had a reasonably hard time with some of the weather
events in the last two years. They have really stabilized
and New Zealand growers are doing a great job of
getting that value to our customers.

Speaker 2 (01:50):
And that explanation you give on Dearie are there's still
people around who don't understand the equation. They may not
like it, but do they not understand it that we
sell stuff to the world. The world is willing to
pay us a lot of money, which is good for
the country. Therefore we end up paying that domestically.

Speaker 1 (02:06):
Yeah, I think in a world of very disturbed global
trade and settings right now, it is fantastic that we
have an economy that does that still. But as you can,
you know, as the product is sold across the world,
then obviously the components that go into milk, butter, cheese,
products like that, you're going to see the impact of
the core components increasing in value. You're going to see

(02:27):
it in our local products. We try to talk about
it like this so that people do understand that's what's happening.

Speaker 2 (02:33):
PlayStation five, which has got nothing to do with supermarkets
yesterday said they are going to put the price up
because life is difficult, and so we're just going to
pass that cost on. How much of that are we
still seeing in food?

Speaker 1 (02:45):
Look, I think food's pretty transparent. It's had a lot
of focus and there's been a lot of measurements and
a lot of tracking of food. So I think it
has a lot of scrutiny. Two thirds of what makes
up the price of what goes on on shelf and
a super market on average the cost of goods from
supplies that's had less scrutiny and less focus than supermarkets.

Speaker 2 (03:05):
You got any read on tariffs, any idea of any
of this floats down to a supermarket shelf, and if
it does win and buy how much?

Speaker 1 (03:13):
I guess The key thing is everyone will know about
tariffs is that it's on products going into countries like
the United States, so at face value, it shouldn't affect
the price of goods that we buy. The real questions
will be two things. One is what happens to availability
around the world. Do we get much higher availability of
products because they're no longer being bought as much in
those countries? And the other one is what happens to

(03:35):
global shipping, So as those patterns change and settle, will
that add cost to New Zealand, will we still get
the same volume of shipping available or will it improve things?
And that's a really guessing game right now that our
team are looking at pretty closely every day.

Speaker 2 (03:48):
Not surprised, Chris appreciate it. Chris Quinn, who's with food stuffs,
of course, eighteen minutes away from eight.

Speaker 1 (03:53):
Tasking for more from the Mic Asking Breakfast. Listen live
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