- Statistics New Zealand
Producer input prices in New Zealand dropped in the third quarter as falling farm gate milk prices cut input costs for dairy manufacturers, reinforcing the view inflation in the South Pacific country will remain subdued. Input prices decreased 1.5% in the July-September quarter, following the 1% decline in the preceding three-month period, while output prices slid 1.1%, Statistics New Zealand said. On an annual basis, inputs climbed 2.2% and outputs rose 2.4%. Prices fetched by dairy-cattle farmers plummeted 28% over the quarter, contributing the most to the quarterly decline in total output prices, while the input prices for dairy product manufacturing tumbled 23%, the biggest drop since the third quarter of 2002.
Other commodity-based industries have also been hit by a recent decline in global prices, including logging and forestry, of which output prices fell 10% in the September quarter. Statistics New Zealand said weaker international and domestic demand and a build up of logs in China affected the prices decline. Wholesale-price deflation is generally reflected in consumer prices, indicating that inflation in the country will remain contained for some time. Statistics New Zealand reported last month that the Consumer Price Index rose 1.0% year-on-year in the third quarter, which is at the bottom of the RBNZ's 1-3% medium-term target band.
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