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Grocery Costs on the Rise

Jan 08, 2021
One of the items that has had some attention in the media is an expected increase in food prices for 2021 across Canada. According to Canada’s Food Price Report 2021, a family of four, two adults and two children, will spend close to $695 more on the same food they purchased in 2020. This represents a 3-5% price increase, bringing the average annual cost of food close to $14,000.
 
A food basket is established consisting of the basic food this family would be purchasing and these items are used to determine prices. What should be noted here is that the items in this basket are based somewhat on the Canada Food Guide recommendations, and the last guide has been criticized for its more costly choices.
 
The Report notes that the average grocery bill has increased 170 percent in the last two decades, and they expect the cost to keep rising, surpassing the general inflation index.
 
There are several suggested reasons for this expected increase. The first is the fallout from Covid-19 and its impacts on food processing and food loss. Other reasons include environmental factors and global issues, such as trade deals, that are out of our control.
 
Undoubtedly, the buying habits of some will change due to the Covid-19 pandemic. Already, we are seeing more interest in local food and Canadian-produced food. Food that is transported over a long distance and handled several times may be more suspect of disease or lack of quality.
 
This leaves us with the question if any of this increase in the consumer’s cost of food will result in more revenue to the farmer who began the production of this said food.
 
The CFFO has always called for farmers to receive a fair return for their efforts. Farmers are price takers, not price setters. When prices increase to the consumer but none of that ends up in the farmer’s pocket, there is a sense of unfairness in the system.
 
On the other hand, the last year has seen new opportunities for many farmers, thanks to increased public interest in local food. With the food system no longer being taken for granted, we could see further expansion of these opportunities.
 
 
Source: OFA