Aussie vegetable prices dropping

Posted by Nicole Eckersley on 18th June 2010

According to AUSVEG, the price of vegetables in Australia has fallen by more than 5% in the last week

AUSVEG CEO Richard Mulcahy said that wholesale vegetable prices had retreated in recent weeks, after a strong run from January until mid-March.

“If you look at the figures in recent weeks, prices at the wholesale level have pulled back sharply and the wholesale vegetable market is a key indicator for the retail sector,” Mr Mulcahy said.

“This is actually a great time for consumers to be buying vegetables as there is real value to be had out there,” he said.

Mr Mulcahy said that temporary weather conditions were a major factor in increases to vegetable prices in the early part of this year due to an undersupply.

“Some production areas had losses due to extreme weather conditions in the early part of 2010 but recent heavy rains have resulted in an excess of supply that will benefit price-conscious consumers,” he said.

Mr Mulcahy said that revenues from the higher prices in the early part of 2010 would not necessarily flow from the retailers on to Australian vegetable growers, who were still struggling under the weight of increasing imports from China and New Zealand and were usually forced to absorb any price fluctuations due to the long term nature of their contracts.

A price rise in the wholesale vegetable market from mid-February to mid-March was followed by an equally sharp decline from mid-March to mid-April of $1.01 per kg or 35.4%.

The overall wholesale vegetable price per kg declined even further last week, by 5.3% to $2.09 per kg, driven by consecutive declines, with an 11.8% reduction in the price of soft cooked vegetables and a 5.5% reduction in salad components.

Cauliflower, capsicums, peas and broccoli were the most significant declines from the previous week, while cucumbers, garlic and chillies firmed as demand for salads eased with the cooler weather.