Costs from grocery suppliers to supermarkets increase 2.1%pa in March

The pace of supplier cost increases to Foodstuffs supermarkets in March was slightly lower than last month, with the Infometrics-Foodstuffs New Zealand Grocery Supplier Cost Index (GSCI) showing an average 2.1% increase in what suppliers charged in March 2026, compared with a year earlier.

“The increase recorded for March was a slight slowdown from the 2.3%pa result in February,” said Infometrics Chief Executive and Principal Economist Brad Olsen. “As anticipated, cost changes in March do not reflect higher input costs developing across the supply chain due to the Middle East conflict. Early indications are that suppliers have been absorbing some of the increases, and it is still too early to fully gauge the impact that we will see on grocery supplier costs.”

“We expect cost increases to start flowing through the supply chain in April and into May, given ongoing volatility, with the wider impact becoming clearer over the next few months, as cost adjustments are made.”

The Infometrics-Foodstuffs New Zealand Grocery Supplier Cost Index (GSCI), commissioned by Foodstuffs New Zealand, measures the change in the list cost of grocery goods charged by suppliers to the Foodstuffs North Island and Foodstuffs South Island co-operatives. The Index utilises detailed Foodstuffs NZ data across over 60,000 products the Foodstuffs co-ops buy to stock in their 500+ stores, making it the largest dataset of its type in New Zealand, to give a real-time view on supplier cost changes.

Every month, the Index tracks what it costs supermarkets to buy the goods to put on the shelf. Previous analysis shows that supplier costs are the major component of supermarket prices, representing two-thirds of the on-shelf price.

Supplier costs rose across all but one department in March compared with the previous year. “Although average cost increases across many departments slowed slightly, a number of key items saw larger increases. In the grocery department, cooking oils, chocolate, assorted herbs, and other household staples saw larger increases in March 2026, compared with the previous year,” said Mr Olsen. “There were also notable increases in supplier costs for cauliflower, green beans, fresh fish, and meat roasts.”

Month on month, just over 2,800 products increased in cost from February to March 2026, with the 12-month average remaining at around 3,000 per month. “Given the lead-time in cost changes, those recorded in March are unlikely to capture the impact of any increases due to the Middle East conflict,” said Mr Olsen. “There were notable larger increases for some produce costs, although it is still too early for many suppliers to get a firm gauge on the impact of rising global pricing pressures such as fuel and packaging.”

“Higher transport costs, and business expectations that higher costs and prices are anticipated, shows the likely pathway. Higher petrochemical and plastics prices globally will increase packaging costs too, showing the breadth of increases that will influence supplier costs.”

ENDS

Note:

The Infometrics-Foodstuffs New Zealand Grocery Supplier Cost Index (GSCI), commissioned by Foodstuffs New Zealand, measures the change in the list cost of grocery goods charged by suppliers to the Foodstuffs North and South Island cooperatives.

List cost refers to the cost suppliers charge retailers before trade spend is applied; trade spend being any form of discount provided by a supplier to allow their goods to be discounted.

The Index utilises detailed Foodstuffs NZ data, across over 60,000 products, analysed by independent economics consultancy Infometrics to produce the GSCI and publish it on a monthly basis. For more details see economics.infometrics.co.nz/report/grocery-supplier-cost-index.