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Canada’s Food Price Report forecasts food prices rising up to 7% in 2022

Supply chain disruptions, inflation, climate change and labour shortages among factors leading to price hike
Epicurious food prices
Between COVID-19-related supply chain disruptions, record inflation, climate change and labour shortages, Canadian food costs are forecast to rise between five and seven per cent in 2022.

Canada’s Food Price Report is forecasting between a five- and seven-per-cent rise in food costs for the average family in 2022, the largest predicted annual price hike in the report’s 12-year history. 

The report, authored by researchers from the University of Guelph, Dalhousie University, the University of British Columbia and the University of Saskatchewan, predicts that a family of four will pay up to $14,767.36 for food next year, an increase of up to $966.08 from 2021. The largest increases are predicted for dairy and restaurants, at between six to eight per cent, and bakery and vegetables, at between five and seven per cent. 

“It’s important for consumers to understand that food prices have been going up for some time, and there’s no turning back,” said Dr. Sylvain Charlebois, project lead and director of the Agri-Food Analytics Lab at Dalhousie University, in a release. “Our relationship with food is changing, and so will our food budgets. Showing up at the grocery store knowing what you should be paying will help.”

Food price increases in B.C., Alberta, Saskatchewan, Ontario and Newfoundland are likely to be higher than the national average, reaching up to seven per cent, due to “inflationary conditions specific to these regions,” the report said. Canada-wide, the average inflation rate of goods this year hit 4.4 per cent, an 18-year high and more than double the average inflation rate of services, which has been 2.1 per cent. In the 20 years preceding the COVID-19 pandemic, goods inflation averaged only 1.4 per cent, according to the Bank of Canada. That has clearly spilled over to the checkout aisle: the average grocery bill rose by 70 per cent between 2000 and 2020. 

Unsurprisingly, COVID-19-related disruptions to the supply chain, driven by high transportation costs and reduced maritime transport capacity, have been a major contributor to rising food costs, but far from the only one. Climate change and extreme weather events continue to impact food prices, something British Columbians were all too familiar with after a year marked by wildfires, a heat dome, droughts and flooding.  

Labour shortages have also affected food costs, particularly in the food service sector, where restaurants have reported challenges hiring both back- and front-of-house staff (80 per cent and 67 per cent, respectively), according to a July survey conducted by Restaurants Canada. 

By no means a new issue for the sector, the pandemic only exacerbated the problem. Though Statistics Canada reports that overall employment in the country has returned to pre-COVID levels, approximately 180,000 positions in accommodation and food services remain unfilled.  

While many—including in Whistler—have pointed to Canada’s Emergency Response Benefit and other government supports offered in the pandemic as a barrier to re-entry for food service workers, the researchers behind the report say the issue isn’t so black and white. Speaking to a cultural issue as much as an economic one, even prior to COVID-19, restaurant positions were becoming increasingly difficult to fill “because they are typically lower-paying with no (or few) employee benefits, physically demanding and prone to sexual harassment and abuse,” the report stated. “These already challenging working conditions are exacerbated by restaurant workers being exposed to a higher risk of contracting COVID-19, having to wear masks during long shifts, and having additional responsibilities to check and validate vaccine passports—the added pressures are making these types of jobs not worthwhile for many.” 

If there is a silver lining to all our food-related challenges, it’s this: Canadians are becoming more food literate and conscious of where their food is sourced from than ever before. As weather events wreaked havoc on our farm crops, and the pandemic forced consumers to stay in their own backyard, Canadians are demanding more environmental sustainability and transparency around food. Case in point: a 2021 survey of Canadians found that 71 per cent of respondents said it’s important for them to know where their food comes from, while 42 per cent said they would buy more locally sourced food even if it costs more. 

COVID-19 has also had the side effect of ushering more Canadians into the kitchen, with more than one-third of Canadians reporting that they had learned a new recipe since the beginning of the pandemic, while 48 per cent said they used a new ingredient in their cooking. 

To view the full report, visit dal.ca/sites/agri-food/research/canada-s-food-price-report-2022.html.