Beef Mince Prices Surge 17.5% as Families Struggle to Cope

The price of beef mince in New Zealand has surged by approximately 17.5% over the past year, reaching an average of $23.11 per kilogram as of September 2023. This significant increase has left many families feeling the financial strain, forcing them to reconsider their grocery choices and seek more affordable alternatives.

Families that once relied on beef mince as an economical option for meals are now turning to smaller portions or substituting with chicken and pork. According to Corinne Haines, City Missioner for Christchurch, the rising costs have placed beef mince beyond the reach of many low-income households. “It was always known as the cheap meat option,” Haines stated, “but now our food bank and financial mentor clients can’t afford it. Sausages and chicken are probably the cheaper options now.”

The increase in beef mince prices reflects broader economic trends affecting household budgets nationwide. Infometrics principal economist Brad Olsen noted that the price hikes are largely due to shifts in international supply and demand. “Beef mince prices have continued to rise over the past 1.5 years because of a scarcity of beef in the global market,” Olsen explained. He pointed out that even with tariffs, the United States still imports significant amounts of New Zealand beef due to its own reduced cattle supply.

Households are increasingly finding it challenging to manage food costs, as Haines emphasized. “Mince used to be a way you could buy a pack and split it into two or three meals by adding extra bits, like vegetables or pasta, to make it go further, but price rises are making this way of saving money more difficult.”

Comparatively, other meat options have also seen price increases. Sausages average $13.52 per kilogram, while pork loin chops are priced at $16.82 and chicken breast at $15.54. In contrast, lamb chops are averaging $21.70 per kilogram, beef blade steak at $28.70, and porterhouse steak reaching $43.26 per kilogram.

The surge in beef mince prices is indicative of a broader trend affecting essential household items. Dr. Murat Ungor, a senior lecturer in economics at the University of Otago, attributed the price increases to strong international demand. “New Zealand consumers are effectively competing with overseas buyers for locally produced goods,” he noted. This dynamic ties domestic prices to global rates rather than local production costs.

The impact of inflation has been significant, with a 2.4% increase in the cost of living for average households over the past year. Dr. Ungor explained that fluctuations in international prices for exported meat and dairy can rapidly change based on supply and demand. “It only takes a very small surplus or shortfall in the global supply of food compared to the global demand for it to massively spike the international price of food,” he stated.

The situation remains precarious, as New Zealand’s food market is highly susceptible to international pressures. “We are very vulnerable to that because basically the government and the farmers are saying, ‘you are subject to the international price of food’,” Dr. Ungor concluded.

As families grapple with rising prices, they can take practical steps to mitigate the financial burden. Monitoring supermarket specials, buying in bulk when prices dip, and comparing unit prices across brands can provide some relief. While these strategies may not fully counteract the effects of global price forces, they offer households a way to navigate the challenging landscape of rising food costs.

The government may need to address the ongoing difficulties faced by families struggling to afford basic necessities. With the current economic climate impacting essential food items, swift action may be required to ensure that all New Zealanders can access affordable nutrition.