The price of butter has soared in the last 12 months, although not generally as much as this block at a dairy in Akaroa recently.

We're all paying more for butter, but spare a thought for bakers in some small towns.

The average price of the cheapest 500g block of butter was $5.67 in October 2017, compared with $5.55 a month earlier and $3.50 in October 2016, Statistics New Zealand said.

But on Monday, the cheapest price for butter at Countdown and New World was $5.90.

Prices are even higher in remote locations such as Four Square supermarkets in Akaroa, where a block of Mainland butter recently $9.19, and in Tapawera, a settlement about 30km southwest of Nelson, where a block of Pam's was $7.29.

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A Tapawera Four Square staff member said she had no control over store prices, which were set by owner Foodstuffs.

"We have to purchase everything from Foodstuffs, we can't buy apples from a local orchard even if it means being cheaper for the customer.

"There are food safety issues, they have to be able to audit where everything comes from," she said.

Higher overall dairy prices have pushed food prices up 2.7 per cent for the 12 months.

Monthly movements in some dairy products. Source: Stats NZ

Stats NZ consumers price index manager Matthew Haigh said dairy products were widely used to make in a number of foods products.

"The effects of price rises flow on to products such as takeaway biscuits, buns, cakes and coffee, and eating out for lunch and dinner, all of which saw increases in the year to October 2017," Haigh said.

To reflect the changing tastes of New Zealanders, Stats NZ has changed the foods it compares in its monthly basket used to measure food price inflation.

It has dropped luncheon sausage, milkshakes, cottage cheese, alfalfa sprouts, canned corn, taro, and spring onions, and added olives, fresh herbs, and herbal teas to the basket.



Items are removed when they become less popular or if they are well represented by other items.

Senior manager Jason Attewell said: "When new items are added to a particular section, we can end up pricing too many things in that section".

"We have been pricing several types of cheese. While making for a great tasting session, there is rarely any difference in price movements between cottage cheese and camembert," he said.

For the month, overall food prices fell 1.1 per cent, thanks to seasonal price falls for tomatoes, lettuces, cucumbers, and capsicums.

Tomato prices were down to $7.68 a kilogram, compared with $10.02 in September 2017, but were up on a year ago when they were $6.83 per kg.

On the rise was the monthly price for kumara, avocado and pumpkin.

Stats NZ updates the 162-item food price index basket every three years, to ensure it reflects what households typically spend on food.

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