HALIFAX, Nova Scotia – Food prices are expected to increase above the acceptable inflation rate, Dalhousie Univ. said in its 7th edition of Canada’s Food Price Report.
The report forecasts food prices to rise between 3 percent and 5 percent. This translates to a potential increase of C$420 in Canadian family food expenses in 2017.
“The biggest factor will be the falling Canadian dollar,” explained Sylvain Charlebois, Ph.D., lead author of the report and Dean of the Faculty of Management at Dalhousie Univ. “Given how many food products we import from abroad our food economy is vulnerable to currency fluctuations. We’re also expecting the upcoming Trump administration to have an impact on Canada’s food prices.”
Charlebois said the Trump administration could create a period of protectionism in the United States which could impact agri-food and seafood exports. He said the Trump administration’s support of infrastructure and the development of the next Farm Bill, may result in subsidies to US farmers and higher expenses, which could trigger a “super cycle” in grain prices and push food prices higher.
The report stated that pork prices could rise higher given that hog futures are forecast to increase in 2017. Meanwhile, cattle futures are expected to remain flat, but increased consumer demand will push prices higher. Prices for meats are expected to rise 4 percent to 6 percent in 2017, according to the report.
Dairy and eggs, and bakery and cereal are expected to remain stable and within acceptable inflation rates of 2 percent or less. However, prices for vegetables, fruits and nuts are expected to surge in 2017 on high import duties. Prices for vegetables are expected to increase by 4 percent to 6 percent, while fruit and nut prices could rise by 3 percent to 5 percent, according to the report.
On a provincial basis, consumers in Ontario and British Columbia are expected to experience above-average food price increases, while Newfoundland and Labrador, New Brunswick, Quebec, Manitoba and Alberta residents are likely to experience lower-than-average increases because of a weaker economy and a more competitive food distribution landscape.
“Food prices are top of mind for everyone. Every single day we have to feed ourselves and we're victims of fluctuating food prices,” Charlebois said. “Canadians are very engaged consumers when it comes to food. We hope the Canada Food Price Report, continues to provide them with the information they want, not just about food prices, but about issues around food safety, quality of food, trends and the region in which they live.”