Highlights
- According to the latest StatsNZ report, vegetable and fruit prices have increased by 17%.
- This has led to an overall rise in food prices.
- Food prices started rising in January itself.
Food prices have been skyrocketing on the back of increases in prices of fruits and vegetables. According to an estimate, fruit and vegetable prices were up by 17% Y-on-Y, driven by tomatoes, broccoli and lettuce.
According to Stats NZ February figures, in a year, meat, poultry, and fish prices increased by 7.1%, grocery food prices increased by 5.4%, non-alcoholic beverage prices increased by 2.3% and restaurants and ready-to-eat meal prices were up by 5.2%.
The stats body also said that food prices started rising in January itself, signifying the largest increase since 2017. The average price of 1 kg tomatoes was NZ$7.29 in January as against NZ$2.94 in January 2021. This was caused mainly by supply-chain disruptions and a shortage of labour to do the farming.
Even the Ukraine-Russia conflict is having an impact on overall prices, especially petrol prices. When the petrol price rises, it has an impact on everything.
Let’s see how some important food stocks listed on the NZX are performing today.
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Cooks Global Foods (NZX:CGF)
It’s a food and beverage company which in its market update, revealed that its UK-based Esquires Coffee stores had performed very well.
Must Read: Which are 4 popular NZX food stocks to consider in 2022?
Despite some significant headwinds like labour shortages, record inflation uncertainty regarding COVID-19 variants and an increase in VAT, CGF’s brands grew from 57 stores in 2021 January to 69 cafes in 2022 in the UK.
On 11 March, the stock was trading flat at $0.033, at the close of the trading session.
Comvita Limited (NZX:CVT)
CVT is a leading producer of honey in New Zealand. On 24 February, the Company announced its results with a record profit jump of 39% at NZ$7.2 million over pcp. The EBIDTA was 14% more over pcp with a double-digit bottom-line growth. It reported a revenue growth of 6.1% despite significant COVID-19 headwinds. It declared an interim dividend of 2.5 cps, which is fully imputed.
Recently, the company announced its share buyback scheme. It plans to buy 300,000 of its ordinary shares with regard to the new scheme. CVT plans to achieve 50% digital sales by 2025.
Also Read: Comvita (NZX:CVT) Hits Profitability In Interim Results
Also Read: Why to explore 2 NZX food stocks in 2022?
On 11 March, the stock was trading up by 1.43%, at NZ$ 3.550, at the time of writing.
Burger Fuel Group Limited (NZX:BFG)
BFG reported that its system sales were NZ$45.6 million for the half year ended 30 September 2021. This is an increase of 11.63% over pcp. The growth came from the opening of franchised stores. Its total stores across geographies increased to 77 as on 30 September. Its net profit was up by 12.7% at NZ$46K. The revenue showed a downtrend but was offset by rent reliefs and the government wage subsidy.
On 11 March, the stock was trading flat at NZ$0.325, at the time of writing.
Bottom line: Food prices are rising and showing a marked increase in different categories over last year. How will the food and beverage industry navigate through this is still to be seen.