New Zealand Producer Input Prices Rise 5.6%, Most in 28 Years

By Tracy Withers
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Aug. 19 (Bloomberg) -- Prices paid by New Zealand farms, factories and other producers for commodities and services needed to run their businesses posted the biggest rise in 28 years in the second quarter led by electricity and fuel.

Producer input prices gained 5.6 percent in the three months ended June 30, the most since the first quarter of 1980, Statistics New Zealand said in Wellington today. From a year earlier, input prices rose 12 percent.

Prices paid for electricity increased 51 percent from the first quarter, the statistics agency said. Low hydro lake levels increased wholesale electricity prices, prompting companies to pay more for power and increase charges for their customers. Power prices rose 86 percent from a year earlier.

Rising crude oil and jet fuel prices increased the fuel costs paid by wholesalers and airlines. The air transport index rose 13 percent. Manufacturers paid more for steel and meat processors paid more for livestock.

Producer output prices, which are paid to factories, farms and other producers, rose 3.5 percent in the second quarter, the agency said. That's the biggest gain in 23 years. From a year ago, output prices increased 8.5 percent.

Generators received more for electricity as wholesale prices rose, the agency said. Oil companies were paid more for gasoline and farmers received more for lambs and cattle.

To contact the reporter on this story: Tracy Withers in Wellington at twithers@bloomberg.net.