While inflation is showing signs of dissipating, food inflation appears to be on a totally different path. Food inflation has outpaced our general inflation rate for over 12 months now.
Statistics Canada just announced that the food inflation rate for retail was 10.8 per cent and 7.4 per cent in food service. Canada ranks third amongst the G7 countries, after Japan at 4.7 per cent and France at 7.7 per cent. Canada’s rate remains below that of Italy (10.6 per cent), the United States (11.8 per cent), the United Kingdom (13.1 per cent) and Germany (16.6 per cent). Still, food inflation is hurting Canadian consumers, and the nightmare won’t end any time soon.
Canadians have been trying to cope with higher food and menu prices in many ways. The Agri-Food Analytics Lab, in partnership with Caddle, investigated what Canadian consumers have been doing to deal with higher food prices in the last year and are releasing the results of the study.
Some have opted to grow their own food. A total of 15.5 per cent of Canadians have started growing their own food just in the last year. Ontario is where the highest percentage of people started to grow their own food, at 17.4 per cent, followed by British Columbia at 16.2 per cent. The Atlantic (15.2 per cent), Quebec (13.7 per cent), and the Prairies (13.1 per cent) were next. While a total of 6.2 per cent of Canadians use hydroponics at home to grow food, 4.5 per cent claim they have livestock at home now, and didn’t 12 months ago.
Others are just trying to navigate through by using new options. The most popular grocery shopping habit change we measured was that many Canadians have used loyalty program points. A total of 33.7 per cent have been using loyalty program points to pay for groceries in the last 12 months. The second option is weekly flyers (32.1 per cent), followed by coupons, at 23.9 per cent.
While 19.1 per cent of Canadians have visited discount stores in the last 12 months, 11.5 per cent of Canadians have visited dollar stores more often to purchase food. A total of 8.0 per cent are visiting farmers’ markets more often, and 7.1 per cent of consumers visited roadside stands to buy directly from farmers in the last year.
Interestingly, 40.6 per cent of Canadians are trying to waste less food now, a much higher rate than 12 months ago. Going for privately labelled food products is also getting more popular. A total of 21.0 per cent of Canadians are opting for store labels, which are less expensive most of the time. The Atlantic region is where the highest percentage of consumers are now opting for privately labelled products, at 27.8 per cent, followed by Quebec at 22.5 per cent. Also, 19.7 per cent of Canadians are buying more food that is about to expire. The Atlantic has the highest percentage of consumers buying food that is about to expire at 29.1 per cent, followed by the Prairies at 19.5 per cent.
The hidden darker side of food inflation is worrisome. Almost 24 per cent of Canadians are now cutting back on the amount of food they purchase due to higher food inflation, and almost 70 per cent of them are women. Dietary changes have been made by 8.2 per cent just to save money. While 7.1 per cent are skipping meals now, 6.6 per cent of Canadians are paying for their groceries with a credit card without knowing when they will be able to pay it back.
Coping with food inflation is not a simple matter of finding new strategies. For many, higher food prices have pushed them toward desperation.
Many Canadians are really battling it out there. In Europe, where food inflation in some regions is even higher than here, grocers are guaranteeing some prices for certain staples for a month or two to help low-income families get through this. They are freezing prices on a limited number of essential staples. These campaigns are all initiated by industry, not government.
Perhaps it’s time for Canadian grocers to sympathize with struggling consumers in meaningful ways. Maybe, just maybe, if they took steps to support consumers, the baseless accusations of “greedflation” would go away, if only for a while.
Dr. Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.