Price rises for beef during the COVID-19 pandemic have not bothered consumers, ANZ says, with the bank’s latest Commodity Report finding consumption increased strongly despite this.
The report says beef prices went up more than any other food category in Australia over the past year, yet consumption also rose.
Within the beef sector, ANZ says, there is anecdotal evidence that mince and lower-priced cuts are becoming more popular than steak as consumers adjust the type of beef they eat in response to the price rises, rather than abandoning the product altogether.
In contrast, overall chicken consumption declined despite the price increases being relatively small compared to beef.
Lamb consumption has been stable, ANZ says, with small increases in per-capita consumption anticipated in the longer term.
ANZ’s food, beverage and agribusiness insights director Madeleine Swan says there is an overall trend to higher food prices, influenced by several factors.
“Both globally and domestically, the decades’ long trend to lower food prices appears to be reversing,” she says.
“Certain retail grocery prices have jumped strongly in recent months on the back of factors including a shortage of livestock, labour and shipping for imports.”
“While beef prices may be making the greatest headlines, the price of fruit and vegetables is perhaps the more interesting story as it highlights Australia’s reliance on the importation of certain, cheaper fruits and vegetables.
“While the increase in the costs of many food staples is likely to impact lower-income earners, particularly at time where petrol prices are also increasing, the upward pressure on retail prices may continue for the foreseeable future if international conditions continue.”
Fruit and vegetable prices increased by five per cent during the last quarter alone, which ANZ was due to both the ongoing labour shortages in picking and limited shipping capacity for items imported to Australia.
Retail prices of cereal and bread have remained stable, which ANZ says is surprising considering the increases in grain prices both domestically and globally.
Dairy prices have fallen slightly, with the retail price of cheese the most noticeable decline.