AFGC predicts Australian slow down despite CHEP Index growth
The rate of growth in retail trade in Australia decreased marginally in the first three months of 2013, and is expected to ease further as the year continues, according to a report from grocery retail representative body Australian Food and Grocery Council (AFGC) and pallet and container manufacturer CHEP.
The report, called the AFGC CHEP Retail Index, showed 3 per cent growth in the March quarter year-on-year, but forecasts growth will ease to 2.6 per cent in the June quarter.
In the month of March, the Index indicates that the Australian Bureau of Statistics (ABS) will report year-on-year growth of 2.6 per cent in the retail sector, with turnover of $21.7 billion. The Index forecasts that May retail trade growth will be 2.8 per cent year-on-year, with turnover increasing to $21.9 billion.
“Retail conditions have been soft through the beginning of 2013, and the Index confirms that consumer confidence remains fragile, with low interest rates yet to bring a sustained lift in the retail sector,” said Gary Dawson, AFGC CEO.
Recent ABS statistics have shown a more solid rate of year-on-year growth in food and grocery retail than overall retail sales growth. Food retail growth was 4.6 per cent in February 2013.
Spending on cafes, restaurants and takeaway food is also seeing a similarly solid growth rate. By contrast, department stores experienced year-on-year sales growth below 1 per cent in February, as growth in online sales and ongoing price deflation weight on non-food retailing.
“We’re pleased to tap into CHEP’s rich data to provide a reliable and robust indicator for the retail sector, which has the ability to look at both food and non-food segments across the supply chain,” said Phillip Austin, CHEP Australia and New Zealand President.
The AFGC CHEP Retail Index is a collaborative project between the AFGC and CHEP Australia, powered by financial services and risk management organisation Deloitte. The Index uses CHEP transactional data based on pallet movements and is a lead indicator of ABS Retail Trade data. The next AFGC CHEP Retail Index will be released in late July 2013.