Are record-high food costs finally slowing down?

Consumers and restaurants continue to battle food inflation, but some costs have started coming down since January, albeit not to pre-pandemic levels. Sylvain Charlebois, senior director of the Agri-Foods Analytics Lab at Dalhousie University, recaps the items with the largest price reductions so far this year:

  • Tomatoes (- 38 per cent)
  • Cucumbers (- 31 per cent)
  • Strawberries (- 18 per cent)
  • Romaine lettuce (- 14 per cent)
  • Celery (- 12 per cent)
  • Pears (- 11 per cent)
  • Bacon (- 10 per cent)
  • Peppers (- 10 per cent)

However, some of the most expensive items have yet to make a change, with Charlebois naming these items as those having risen the highest in price:

  • Pork shoulder cuts (+ 92 per cent)
  • Grapes (+ 42 per cent)
  • Carrots (+ 21 per cent)
  • Oranges (+ 19 per cent)
  • Squash (+ 17 per cent)
  • Orange juice (+ 16 per cent)

With the cost of food soaring to an 18 per cent increase over the last few years, settling at 8.3 per cent higher year-over-year as of April, some of the drivers of inflation over the last few years seem to be easing. However, even with this good news, Canadians will not see prices dropping soon. While some of the supply chain bottlenecks have started to ease since the pandemic, extreme weather patterns are becoming more frequent, which could lead to low livestock levels, inconsistent availability, and ongoing cost increases.

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As the high cost of food continues and consumers try to stretch their dollars, it may be affecting restaurant revenues. Recent studies show that QSR visits were down 1.8 per cent this past quarter over the first part of the year. The same study showed that the transaction totals were down 3.8 per cent, demonstrating that consumers are ordering fewer items when they do visit.

Restaurants will need to continue getting creative in cutting costs, managing margins, and raising their revenue levels.