The 14th annual food price report was released on Thursday with a focus on how Canadians are spending less despite inflation, either by reducing the quantity or quality of food, or by substituting less expensive alternatives.
In all, Canada’s 2024 Food Price Report predicts an increase of 2.5 to 4.5 per cent in overall food costs in the new year, with a rise across the board.
Sylvain Charlebois, professor and director of the Agri-Food Analytics Lab at Dalhousie University, says that in 2023, all sections of the grocery sector were impacted by inflation. Charlebois says they expect a “soft landing,” with inflation expected to cool for the new year.
“We’re expecting some price wars. Things are tightening up right now for grocers and suppliers,” Charlebois told CityNews. “We’re expecting an inflation rate of 2.5 per cent to 4.5 per cent … but we wouldn’t be surprised if it falls below that threshold.”
Charlebois says that while Canadians vilify inflation in general, it’s something this sector needs.
“We need [inflation] for investments, you need it to increase competition, and you need it to get companies to innovate and make sure that our food is safe,” he said.
“The challenge we have had over the last couple of years is that the rate has been much too high for far too long. We wouldn’t be surprised that in 2024, we go back to that proverbial sweet spot.”
2024 Canadian food prices table
Bakery: 5% to 7%
Dairy: 1% to 3%
Fruit: 1% to 3%
Meat: 5% to 7%
Other: 2% to 4%
Restaurants: 3% to 5%
Seafood: 3% to 5%
Vegetables: 5% to 7%
Provincial breakdown of food prices
According to the report, retail food sales data indicates a decline from a monthly expenditure of $261.24 per capita in August 2022 to a monthly expenditure of $252.89 per capita in August 2023.
The rise in prices can be attributed to various factors, including climate events that have had adverse effects on harvests, such as wildfires and flooding throughout the country.
Coffee, flour, vegetables and meat: Food items that will cost more or less
Charlebois said consumers should feel better about the costs of certain food products. He mentions coffee, flour, wheat and dry pasta as some to look out for in terms of lower prices.
“Even dairy. We got some good news in the fall from the commission. Farm prices will go up by 1.7 per cent to 2 per cent, which is quite reasonable, to be honest. We’re not expecting major jumps in the dairy section at all.”
Charlebois says the meat section will be problematic in terms of high costs, as well as the costs of vegetables and the bakery sector.
According to Statistics Canada’s food retail data, Canadian consumers are spending less. Photo: Unsplash.
“The vegetable play is about the dollar. It’s been a story for about two or three years now. Because of the interest rate and a potential recession, we may see the dollar weaken … That is going to impact the purchasing power of importers,” Charlebois said.
“In the meat section, beef is going to increase because of droughts in the U.S. and Canada. Poultry is going to increase because of the Avian Flu. Pork got cheap this year, so we have fewer farmers farming hogs. There is less supply … eventually, we are expecting more prices to increase over the next little while.”
As for whether Charlebois thinks this is good news for Canadians, he mentioned that the latest report indicates that it won’t be as alarming in 2024 as in years past.
“If you’re looking at prices to drop, you won’t celebrate. What this report is telling Canadians is that things are not as dire as in 2023 or even in 2022,” Charlebois said.
“I think that the worst is behind us, which is good news … I don’t know if consumers want deflation or if they understand what it means. It would mean companies would divest, and prices would skyrocket again. You don’t want prices to drop in the food industry, but you want deals … that didn’t happen in the last couple of years.”
Managing food costs vs. the costs of living
Another indication of how the cost of living is impacting how residents spend on food, the report shows Canadians are facing additional pressures, including higher costs for rent and utilities and rising personal debt.
“Based on the 2023 predictions, the total annual expenditure for a family with the following demographic composition: man (aged 31-50), woman (aged 31-50), boy (aged 14-18), and girl (aged 9-13), was originally projected to be $16,288.40, based on what we considered to be a healthy diet,” the report states.
Food inflation is the gradual rise in the cost of all food products, whereas food price increase refers to the higher pricing of a product at the retail level. Photo: Unsplash.
“This year, in recognition of the reduced spending habits of Canadians, a more accurate estimate for the annual spending of a family of four in the past year is $15,595.40.4. In other words, they spent $693 less due to changes in shopping habits, despite higher food prices.”
Experts say Canadians will continue to experience the strain of food inflation in 2024, compounded by increasing costs of housing, energy, and various other expenditures.
Further, Canada’s 2024 Food Price Report indicates that the new year may witness a “mild deflationary trend,” resulting in lower prices for numerous essential food items.
Corporate behaviour and the profits of major grocers
Canadians are trading down and going to discount stores, but also eating more at home to try and save money, which benefits the grocers.
Major Canadian grocers, such as Loblaw, have been under pressure to stabilize Canadian food prices. The federal government has called on them to provide detailed plans to address rising food costs through discounts, promotions and other measures.
The 2024 report mentions the prevalent issue of food affordability and how it has remained a top concern as prices
continued to rise throughout the year.
“There were widespread concerns about corporate behaviour, with allegations of profiteering by Canada’s major grocery chains frequently reported in the media and the subject of government attention,” the report states.
“A significant 30.3 per cent of Canadians believed that price gouging was the primary reason for the escalating food prices.”
Canada’s Food Price Report of 2024 is an annual publication collaboratively produced by Dalhousie University, the University of Guelph, the University of British Columbia, and the University of Saskatchewan.
TORONTO – Roots Corp. may have built its brand on all things comfy and cosy, but its CEO says activewear is now “really becoming a core part” of the brand.
The category, which at Roots spans leggings, tracksuits, sports bras and bike shorts, has seen such sustained double-digit growth that Meghan Roach plans to make it a key part of the business’ future.
“It’s an area … you will see us continue to expand upon,” she told analysts on a Friday call.
The Toronto-based retailer’s push into activewear has taken shape over many years and included several turns as the official designer and supplier of Team Canada’s Olympic uniform.
But consumers have had plenty of choice when it comes to workout gear and other apparel suited to their sporting needs. On top of the slew of athletic brands like Nike and Adidas, shoppers have also gravitated toward Lululemon Athletica Inc., Alo and Vuori, ramping up competition in the activewear category.
Roach feels Roots’ toehold in the category stems from the fit, feel and following its merchandise has cultivated.
“Our product really resonates with (shoppers) because you can wear it through multiple different use cases and occasions,” she said.
“We’ve been seeing customers come back again and again for some of these core products in our activewear collection.”
Her remarks came the same day as Roots revealed it lost $5.2 million in its latest quarter compared with a loss of $5.3 million in the same quarter last year.
The company said the second-quarter loss amounted to 13 cents per diluted share for the quarter ended Aug. 3, the same as a year earlier.
In presenting the results, Roach reminded analysts that the first half of the year is usually “seasonally small,” representing just 30 per cent of the company’s annual sales.
Sales for the second quarter totalled $47.7 million, down from $49.4 million in the same quarter last year.
The move lower came as direct-to-consumer sales amounted to $36.4 million, down from $37.1 million a year earlier, as comparable sales edged down 0.2 per cent.
The numbers reflect the fact that Roots continued to grapple with inventory challenges in the company’s Cooper fleece line that first cropped up in its previous quarter.
Roots recently began to use artificial intelligence to assist with daily inventory replenishments and said more tools helping with allocation will go live in the next quarter.
Beyond that time period, the company intends to keep exploring AI and renovate more of its stores.
It will also re-evaluate its design ranks.
Roots announced Friday that chief product officer Karuna Scheinfeld has stepped down.
Rather than fill the role, the company plans to hire senior level design talent with international experience in the outdoor and activewear sectors who will take on tasks previously done by the chief product officer.
This report by The Canadian Press was first published Sept. 13, 2024.
VANCOUVER – Mediated talks between the union representing HandyDART workers in Metro Vancouver and its employer, Transdev, are set to resume today as a strike that has stopped most services drags into a second week.
No timeline has been set for the length of the negotiations, but Joe McCann, president of the Amalgamated Transit Union Local 1724, says they are willing to stay there as long as it takes, even if talks drag on all night.
About 600 employees of the door-to-door transit service for people unable to navigate the conventional transit system have been on strike since last Tuesday, pausing service for all but essential medical trips.
Hundreds of drivers rallied outside TransLink’s head office earlier this week, calling for the transportation provider to intervene in the dispute with Transdev, which was contracted to oversee HandyDART service.
Transdev said earlier this week that it will provide a reply to the union’s latest proposal on Thursday.
A statement from the company said it “strongly believes” that their employees deserve fair wages, and that a fair contract “must balance the needs of their employees, clients and taxpayers.”
This report by The Canadian Press was first published Sept. 12, 2024.
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
