Kiwis can expect to see price hikes on food on a scale never seen before, farmers warn, as production costs continue to climb.
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Source: UN News - the United Nations

David Clark, an Ashburton farmer, told 1News the cost of growing food is growing “exponentially”.

“Unfortunately, that is going to end up hitting the household consumer pocket,” he said.

Meanwhile, supply chain issues are causing headaches on David Acland’s farm in Mount Somers.

He was meant to send his sheep to the works last month. But, pressure on the supply chain has meant there was a backlog.

He said the sheep were now consuming the grass that other animals would have been eating.

“So, that is an added cost.”

It’s not just livestock – Covid-19, climate change and the war in Ukraine are causing a worldwide wheat shortage.

The cost of wheat has doubled globally since the start of the war. In New Zealand, it’s increased about 30-40%.

There is a silver lining, however – exports are in demand, with prices at record highs.

“It’s great for New Zealand, really, when you think about it,” Acland said.

“If we were facing all these inflationary costs and we didn’t have food as our main export income, then we’d be in a great deal of trouble.”

But, he said it was hard to predict how long it would last.

Acland said there was a “real concern” a shock may be on the way and there would be a “big reset” in what people were willing to pay for lamb.

“That, for me, is the scary bit.”

Falling dairy prices are a double-edged sword that benefits consumers and manufacturers, but pinches farmers’ margins and threatens additional challenges later in the year, cautioned Mike McCully, independent dairy consultant for The McCully Group, shared during a recent Dairy Deli Bakery Association webinar.

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