Canada’s Wholesale Food Prices Will Rise by 34% on Average Between 2022 and 2025, Says Professor

Produce in a grocery store in Toronto on Nov. 30, 2018. Nathan Denette/The Canadian Press

A new model by Dalhousie University’s food analytics lab has forecasted that compared to 2022, wholesale food prices in Canada, before goods are sold to grocers, will rise by 34 percent on average for all food categories by 2025.

“It’s going to be quite problematic and I think we need to be ready for this,” Professor Sylvain Charlebois, senior director of the Agri-Food Analytics Lab, told The Epoch Times on April 19.

According to the model, created using historical data and machine learning, by 2025 restaurant foods are expected to go up by 46 percent, meats by 45 percent, dairy by 41 percent, fruits by 29 percent, bakery goods by 35 percent, seafood by 24 percent, and vegetables by 8 percent.

The prediction comes after Canada’s Food Price Report 2023, released by the lab in December 2022, projected a 5 percent to 7 percent food price increase in 2023 and said that the average Canadian family of four will pay $1,065 more for food this year than in 2022.

The most recent Statistics Canada consumer price index (CPI) report found that the CPI rose 4.3 percent year over year in March following a 5.2 percent increase in February.

In addition, “Year over year, prices for food purchased from stores rose to a lesser extent in March (+9.7%) than in February (+10.6%), with the slowdown stemming from lower prices for fresh fruit and vegetables.”

Charlebois, known as the “Food Professor,” cautioned that while Dalhousie University has been forecasting for 15 years, it has occasionally been incorrect. He said the university’s Canada Food Price Report has a historical accuracy rating of around 80 percent.

“Forecasting is not an easy thing to do, and we’ve never actually gone beyond 12 months because a lot of things can happen,” Charlebois said. “In December 2021, we released a price report and two months later Vladimir Putin actually had different plans that impacted global food prices everywhere.”

According to Charlebois, several Canadian provinces recently approached Dalhousie to ask the university to predict food prices for the next few years. He said the provinces have been struggling with their food budgets due to inflation, which has impacted their ability to provide support to hospitals, institutions, and schools.

“I presented these numbers to a food industry group in Toronto yesterday, and frankly nobody’s really surprised, because they know what’s going on. The reality is it’s been really tough for the food industry,” he said.

Bank of Canada Prediction

Dalhousie University’s projections contradict those of Bank of Canada Governor Tiff Macklem.

The governor said on April 18 that the central bank predicts food price inflation will “come down in the months ahead” and that overall inflation will fall to 3 percent by summer 2023, to 2.5 percent by the end of the year, and to its target of 2 percent by the end of 2024.

Charlebois, for his part, said the gap between Canada’s food inflation and overall inflation is at 4.6 percent and increasing, while the gap between the two figures is decreasing in the United States.

“That’s why I’m a little bit concerned, to be honest, because there’s a lot of elements in Canada that are actually pushing prices higher,” he said.

According to Charlebois, the federal government’s carbon taxes will continue to increase the cost to grow, process, and transport food.

“With the carbon tax at $170 a tonne by 2030, does it also mean that food processors will go to the United States where there is no carbon tax?” Charlebois asked.

The banning of plastics could also drive up food prices, according to Charlebois. Ottawa banned five different types of single-use plastics effective Dec. 20, 2022, including checkout bags, cutlery, stir sticks, straws, and foodservice ware made from or containing certain plastics that are hard to recycle.

In addition, all plastic packaging in Canada will need to contain at least 50 percent recycled content by 2030.

“It doesn’t matter what alternatives you use, plastics were useful because they are the cheapest of all options. And so when you’re replacing plastics, they will actually cost more to keep our food safe and fresh,” he said.

Charlebois said that if food continues getting more expensive, Canadians’ relationships with food will need to change.

“Canada had access to one of the cheapest food baskets in the world for a very long time, where we spent about 9 percent of our budget on food. But that percentage is likely going to go up,” he said.