The price of butter hit a record $5.67 a block in October, and played a big part in driving the Food Price Index higher October, Statistics NZ (SNZ) said.

SNZ said rising dairy prices have pushed food prices up 2.7 percent in the year to October, following a 3.0 percent increase in the year to September 2017.

"Butter prices led the way again - up 62 percent from the same time last year," SNZ said.

Milk and cheese prices also increased (up 7.5 and 12 percent respectively) and had large contributions to the increase in food prices seen in the year to October 2017.

"Dairy products are very widely used inputs in a number of food items," consumers price index manager Matthew Haigh said in a statement.

"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."

SNZ said the average price of the cheapest available 500g block of butter was $5.67 in October 2017, compared with $5.55 in September 2017 and $3.50 in October 2016.

Butter prices have reflected the price of the commodity on world markets.