Willis told RNZ’s First Up programme this morning it didn’t seem quite right that butter seemed to be cheaper in Australian supermarkets.
The price of a block of butter is now 120% higher than it was a decade ago, according to Stats NZ. In the year to June, it was up 46.5% to $8.60 for a 500g block.
At her regular meeting with the co-operative this week she would be discussing what gets added to the cost by retail brands, including Fonterra’s Anchor, and at the wholesale level.
“My frustration has been when you sometimes go on to an Australian supermarket website and see that butter appears to be cheaper there than in New Zealand, that doesn’t seem quite right. So that’s exactly the conversation I want to have.
“They’ll have the opportunity to set out their case.”
It was well understood the main driver of prices for dairy products was international demand and pricing, Willis said.
“But competition at the retail level does seem to have an effect on price, because organisations like Costco choose to have a really low price point on that product to get people in the door and the ultimate winner of all of that is the Kiwi shopper.
“So I’m talking to Fonterra about what they’re seeing in terms of the supermarket pricing behaviour, what the margins are.”
In May, Costco Auckland’s special pricing saw queues out the door.
Federated Farmers dairy chair Karl Dean has urged retailers to lower prices quickly when costs go down, and said there was probably very little Fonterra itself could do.
“To put in it in perspective, there hasn’t been any new players onto the domestic market in the last 10 years in terms of butter, other than the likes of Westgold – Westland have got their very premium product,” he told RNZ’s Morning Report programme last week.
