Sep 29, 2021
Canadian food inflation nearly double what official data suggests: Study
Canadian food inflation is at 5%: Dalhousie University study
Climate change and the COVID-19 pandemic are causing food prices in Canada to rise, but a new study suggests the official data is underestimating the increase.
According to Statistics Canada, food prices are up 2.7 per cent over the past 12 months. But, new research from Dalhousie University’s Agri-Food Analytics Lab published Wednesday shows the food inflation rate in Canada is closer to five per cent.
Meat products have seen the largest price spike, with Statistics Canada data noting those products have become 10 per cent more expensive over the past six months.
In partnership with consumer insights startup Caddle, the Dalhousie lab surveyed 10,000 Canadians over the summer to determine how consumers are responding to rising grocery bills.
Nearly half of Canadians (49 per cent) said they have reduced their purchases of meat products over the past six months due to higher prices. In Alberta, widely known as the steak capital of Canada, a majority of consumers (57 per cent) acknowledged cutting back on meat since the start of this year.
Many Canadians are also spending more time and effort searching for the best deals than they did last year. The survey found 42 per cent of respondents were reading their weekly grocery store flyer more often this year than in 2020.
Nearly as many (40 per cent) said they were purchasing discounted products with expiry/best before dates within a few days of purchase more often in 2021 than they were last year. More than one in four Canadians (26.9 per cent) said they are buying products with an “enjoy tonight” label more often this year than they did in 2020.
Canadians have also noticed increasing use of a strategy known as “shrinkflation,” the study found, whereby food producers sell products with less quantities or volume without reducing the price. Almost three quarters of respondents (73.5 per cent) said they were aware of certain food products that have shrunk, despite prices either remaining the same or increasing.
“We are aware that many consumers dislike such a strategy, believing it may be dishonest, especially right now,” Dr. Sylvain Charlebois, director of the Agri-Food Analytics Lab, said in a summary of the study’s preliminary results. “But on the flipside, from a food waste perspective, Canadians have historically bought too much food and have wasted a lot at home.”
“Shrinkflation could be getting Canadians to waste less food at home,” Charlebois said.
In terms of the factors driving the trend of rising food prices, the study cites “macroeconomic shocks, caused by both unfavourable weather patterns in the northern hemisphere and logistical challenges due to the global pandemic.”
Supply chain disruptions related to the COVID-19 pandemic are widely seen as transitory and should eventually dissipate. The ongoing impacts of climate change, however, could send food prices soaring globally for decades.
Yields of staple crops could decline by almost a third by 2050 unless emissions are drastically reduced in the next decade, according to a Chatham House report published earlier this month, while farmers will need to grow nearly 50 per cent more food to meet rising global demand during the same timeline.