Falling prices for dairy products and higher fuel costs have nudged producer input and output prices up, Stats NZ said today.
Overall, producer input prices (the costs producers pay) rose 0.6 percent in the March 2018 quarter. Producer output prices (the prices producers get for their goods and services) rose 0.2 percent in the same period.
In the March 2018 quarter, output prices for dairy cattle farmers rose 2.3 percent, while the price for dairy product manufacturing fell 7.0 percent.
Input prices for dairy product manufacturing rose 1.7 percent, mainly influenced by a rise in the farm-gate milk price.
“An increase in the forecast farm-gate milk price from $6.40 to $6.55 pushed up prices received by dairy cattle farmers,” business prices manager Geoffrey Wong said. “At the same time, dairy product manufacturers received less as whole milk powder and butter prices fell.”
In the March 2018 quarter, rising fuel costs affected both petroleum and coal product manufacturers, and farmers.
Input prices for petroleum and coal product manufacturers rose 7.2 percent due to higher crude oil prices.
However, the prices these manufacturers received (output prices) rose only 4.3 percent, reflecting higher diesel, petrol, and other non-crude petroleum oil prices. Fuel prices in the farm expenses price index (FEPI) rose 3.4 percent, influenced by a rise in diesel prices for farmers.
In the year ended March 2018, producer output and input prices increased 3.5 percent and 4.2 percent, respectively. The FEPI increased 3.1 percent, while the capital goods price index (CGPI) increased 2.6 percent.