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Butter prices in New Zealand have surged by 65% this year leading to March, according to Stats NZ data reported by The Guardian.
Despite dairy being the country’s largest export industry, recent figures from Stats NZ showed average domestic butter for 500g were pushed up to NZ$7.42 (US$4.50) – an increase of about NZ$3 (US$1.82) compared to the same period the previous year.
As a result of soaring prices, New Zealanders had been driving for hours in search of cheaper butter, ordering it from Australia or even churning their own, the 7 June report said.
People had been queueing at Costco in Auckland to bulk buy its cheaper blocks, prompting the wholesaler to cap purchases to 30 per shopper.
Some New Zealanders were also using social media to teach others how to make their own butter, and bakeries across the country have reported having to either increase their prices or face closure, according to the report.
Luella Penniall, owner of Kaye’s Bakery in Southland, was quoted as saying she was frustrated at having to import cheaper alternatives, despite living in a country that produces so much dairy produce.
New Zealand is the world’s top dairy exporter, producing a third of the world’s dairy trade. The industry represents about NZ$11.3bn (US$6.86bn) or 3.2% of the country’s GDP and plays a significant role in regional economies.
Global supply problems and high demand for New Zealand’s products were driving local prices higher, according to Infometrics chief executive Brad Olsen.
With around 95% of New Zealand’s dairy products exported, the global market dictated domestic prices, The Guardian wrote.
This was a “double-edged sword”, with high prices good for the economy but tough for domestic shoppers, Olsen said.