Yahoo Finance Canadians expect food prices to keep going up: Yahoo/Maru poll
Cost of food bought from grocery stores rose 9.1% annually in June, up from May's 9%
A majority of Canadians believe grocery prices will continue to rise, a new Yahoo/Maru Public Opinion poll has found, even as the country's overall inflation rate returns to the Bank of Canada's target range.
The survey of 1,527 Canadian adults found that 71 per cent of Canadians believe food costs at their local grocery stores will be even higher six months from now. Another 26 per cent expect prices will likely remain the same in six months, while just 3 per cent believe that the cost of food will fall in that time frame.
Even as Canada's overall inflation rate has slowed – the Consumer Price Index dropped to 2.8 per cent in June – food prices have remained high. The cost of food purchased from grocery stores increased 9.1 per cent annually in June, up from 9 per cent in May. The cost of fresh fruit jumped 10.4 per cent, in part because grape prices soared 30 per cent on a monthly basis. Meat prices were up 6.9 per cent annually, bakery products up 12.9 per cent, and dairy products some 7.4 per cent higher.
While the vast majority of Canadians believe skyrocketing food prices are here to stay, Maru executive vice-president John Wright says "a majority don't pin the blame squarely on companies selling those goods."
About four in 10 Canadians (39 per cent) say grocers are to blame for skyrocketing prices, and that food retailers have been making higher profits off inflation, something Canada's biggest grocery chains have denied.
The Yahoo/Maru poll found that 28 per cent of Canadians believe prices are up because of the higher costs grocery retailers are facing. Another 15 per cent say events, such as the war in Ukraine and weather events including droughts and flooding, are forcing up the price of food. Twelve per cent say government policy – including spending programs and regulatory red tape for food producers – is mostly to blame. Six per cent cite other reasons.
On Wednesday, Loblaw's chief financial officer Richard Dufresne said the company is "highly concerned" about the cost increases it faces from suppliers. Loblaw says price increases have totalled $1 billion, double what the retailer normally faces.
"We have received double-digit increases from the same suppliers who gave us double-digit increases last year. That's why you see products that are noticeably more expensive than they were just a couple years ago," Dufresne said.
"While cost increases are coming in from all tiers of our supplier base, the largest global brands stand out."
Wright says the issue of rising food prices is one that "is likely to dog the government for some time to come."
"The fact is that most of what causes higher food prices is well beyond the control of any government except when they boost wallets with more money to buy groceries which, in turn, can keep prices higher."
The survey of 1,527 Canadian adults was conducted between July 21 and July 24 and has an estimated margin of error of +/- 2.5 per cent, 19 times out of 20.
Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.
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