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Canadian grocery shoppers warned to expect 'several months of rockiness' as food prices rise

Canadians are likely to see inflated food prices at their local grocery stores for several more months, some experts say.

Sylvain Charlebois, senior director of the Agri-Food Analytics Lab at Dalhousie University in Halifax, told CTV News Channel on Sunday that food prices have risen by about five per cent across the board since January.

"Now five per cent may seem low, but for consumers out there looking for similar products, some products have actually gone up by 20, 25 per cent," he said.

When it comes to global food inflation, Charlebois says we are likely in the "third inning of a nine-inning baseball game right now," which will mean "several months of rockiness at the grocery store, unfortunately."

However, Charlebois says he isn't expecting any extra innings beyond that.

Bank of Canada governor Tiff Macklem has warned of longer-than-expected inflation affecting Canadians. The inflation rate is currently 4.4 per cent, up from 4.1 per cent in August, and could reach five per cent by year's end.

The United Nations also has reported that global food prices are the highest they've been in more than a decade.

Charlebois says everyone will have noticed these increases at the meat counter, where the cost of beef has risen by more than 50 per cent. The price of chicken, he says, typically sees a two to three per cent increase every year, but is now up by 13 per cent, as are eggs. Pork, too, has become more expensive.

Statistics Canada recently reported that the price of bacon reached an all-time high in August, with the average cost for a 500-gram pack hitting $8.24, surpassing the $8 mark for the first time ever.

"So that really has been a place where people have been spooked a little bit," Charlebois said.

Input costs are rising on the processing side, as well, with items such as pasta and sauces expected to become more expensive.

Last month, the Canadian Dairy Commission recommended an increase to the price of farm gate milk starting early next year in order to partially offset rises in processing costs.

Charlebois says many processors are expected to reduce the amount of variety in the foods they produce.

"So if you see holes on shelves for the next few months, don't panic, OK, just relax. It's just because grocers are recalibrating their portfolio of brands," he said.

"It's just we're making more of fewer things. That's really what's going on right now."

Looking ahead to 2022, lingering issues, largely around labour, are expected to be factors that will continue to affect the entire supply chain, along with transportation.

"We're paying more to retain employees, which is great news for employees, but you know, prices have to be adjusted when you're in a high-volume, low-margin environment," Charlebois said.


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