The pandemic has already raised costs in foodservice and beyond, wreaking havoc on supply chains and food availability. And Canadians are about to start paying a whole lot more for food, according to Canada’s Food Price Report 2022.
The guide, released on December 9, is published annually by researchers with Dalhousie University, the University of Guelph, the University of Saskatchewan, and the University of British Columbia.
This time last year, the report was forecasting an increase of between three and five per cent for food prices, with a theoretical family of four consisting of one man, one woman, one boy, and one girl on track to pay about $13,907 to feed themselves in 2021. That estimate proved to be out by only $106, a tiny margin of error.
An unprecedented increase
In the 2022 edition of Canada’s Food Price Report, the projection is that food prices will likely increase by between five and seven per cent — or an extra $966 for the typical yearly family grocery bill.
“It’s the highest increase that we’re predicting in 12 years, both in terms of dollars and percentage,” said Sylvain Charlebois, the chief researcher on the report and a professor studying food distribution and security at Dalhousie University in Halifax, per CBC News. “It’s not going to be easy.”
Dairy goods, already generally more costly than many other food items, are expected to be comparatively much more expensive, with a price increase of between six and eight per cent. The report puts that down to higher costs for things like feed, energy, and fertilizer, along with higher transportation and labour costs. The Canadian Dairy Commission warned of that in a report last month, when it asked the government to allow an 8.4 per cent increase in retail milk prices to account for those added costs on the production side.
Meanwhile, the price of bakery goods is expected to increase by five to seven per cent, vegetables are forecast to cost five to seven per cent more, fruits are expected to cost three to five per cent more, and meat and seafood are projected to cost up to two per cent more.
According to the report, food prices will vary across the country.
Numerous provinces, such as Ontario, B.C., Alberta, and Saskatchewan, will experience above-average food price increases. Others, including Manitoba, Nova Scotia, and Quebec will be hit less hard.
Charlebois cites the major factors in the price increases as spiking commodity prices, labour costs and staff shortages rising, and logistical difficulties.
Another major factor, and one that is growing in impact, is the increasing cost of food waste. Research suggests that more than half of all the food produced in Canada gets thrown out. Charlebois says there’s a growing trend from some stores and consumers to try to reduce that waste by finding ways to sell it to those who want it.
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“Grocers are empowering consumers to rescue food more [by] showcasing products that are about to expire at a discount 25 to 50 per cent off,” he said. “People are starting to realize that the aesthetics that we see in the grocery store are costing us money.”
The authors of Canada’s Food Price Report also say climate change is also impacting food prices. Wildfires, record-breaking heat and drought, floods and cold fronts are “becoming increasingly commonplace and affecting food prices year after year.”
Restaurants not exempt
Meanwhile, the report predicts it will also cost Canadians more to eat out, with prices at restaurants expected to increase by six to eight per cent in 2022. There will also be fewer menu choices and higher menu prices at restaurants.
“Menu prices at restaurants are predicted to increase as businesses contend with rising food prices, rising commercial rents and labour market challenges,” the report reads.
Over the last year, Canada has fallen from 18th to 24th in the world in the ranking of food affordability, according to the United Nations.
Charlebois concluded that Canadians, unfortunately, need to get used to rising food prices.
“I actually do think that higher prices are here to stay,” he said, per CTV News. “And we’re going to have to get accustomed to higher food bills.”
Despite these challenges, Canada’s Food Price Report stresses that consumers’ food choices will continue to be motivated by health and environmental sustainability and a commitment to supporting local food supply chains.