"The shortage of beds has also been exacerbated by the upsurge in young people coming through the Youth Courts, particularly in Rotorua."
Mr Te Kani said while there were inadequate beds, solving the problem was not as simple as adding more.
"There is a whole raft of complicated issues adding to the shortage and it is important to note that nobody wants these youths kept in police cells. Child Youth and Family, police, courts and lawyers all try their hardest to place them - it is nobody's fault, it's the shortage and the issues that come with that."
Child, Youth and Family general manager, youth justice support/residences Chris Polaschek said there had been a "sustained period of demand" in the last few months and they were in the process of developing responses to the increase.
There are currently 100 male and female beds available at three of the youth justice residences and an additional 30 male-only beds at Te Maioha o Parekarangi, Rotorua.
"We are looking at options for increasing the number of places available. While we work through this, we will continue to focus on the best interests of the young people we have in custody."
Mr Polaschek said he recognised holding youths in police cells was not the preferred option.
"If a young person requires containment and there is no safe community placement and there is no bed in a secure youth justice residence, then the reality is that they may remain in police cells until a bed or other suitable placement becomes available."
He said the number of young people staying in cells for more than 24 hours was relatively low.
"In the last three years the average duration of a young person's stay in cells has been less than two days and it is very unusual for the stay to be more than 36 hours."
Inspector Ross Lienert, New Zealand Police national manager youth police, said holding youth in police cells was often the "last resort".
"Police recognise that it is not appropriate for youth to be held in cells and we work closely with Child Youth and Family to ensure that a police cell is the absolute last resort for a youth offender.
"Police closely monitor these young people when they are held in police cells to ensure their wellbeing.
"Youth offenders and adults are kept separately in the cells and this may involve additional staff for monitoring purposes."