Food prices climbed during the second year of the pandemic -- and climate disasters contributed

Record-breaking heat, severe drought and devastating floods have impacted food production, indirectly bringing prices in Canada to a decade high, according to the data provided by Statistics Canada.

Food inflation is the year-over-year increase in the value of all food items. In December, food inflation hit 5.2 per cent, according to Statistics Canada, up from around 1 per cent to start the year.

Across the world, food prices rose sharply in 2021, according to a report by the United Nations. The agency’s Food Price Index, which tracks monthly changes in international prices, showed a 28 per cent increase over 2020. Along with labour shortages and a global pandemic, volatile climatic conditions have been responsible for reduced production which is impacting agricultural food prices.

Production impacted by adverse weather conditions

“We live in a global food system,” says Sean Smukler, chair of agriculture and environment at the University of British Columbia. “I can't imagine that there are many places in the world where production in one location doesn't impact the price and availability of food in another location in the world.”

In a phone interview with CTVNews.ca, Smukler said weather-related events in 2021 such as droughts, changes in precipitation patterns, and wildfires had an impact on food production. Smukler said that the markets are based on supply and demand, and if supply is being affected, the markets will react.

“These have been long predicted by climate scientists and are now becoming a very obvious reality,” Smukler says.

A recent NASA study noted that global agriculture is facing a new climate reality and with the interconnectedness of the global food system, impacts in even one region’s breadbasket will be felt worldwide.

According to Canada's Food Price Report, in 2021, Canada experienced climate change-related adverse weather effects, such as severe wildfires in British Columbia and drought conditions in the Prairies, that affected the prices of meat and bakery products.

Canada’s westernmost province has been hit hard by extreme weather conditions, scorching heat, and heavy rainfall with floods. Last year, B.C. faced extreme heat, severely damaging crops. With temperatures touching 40s, the heat left about 50 per cent of its berry crop damaged at some farms. A few months later, floods disrupted the food supply, leaving shelves empty. The damage by the floods in B.C. resulted in an insured loss of $515 million, the highest insured damage from any severe weather event that year.

2021 saw a series of catastrophic climate changes, with Calgary hailstorm and BC floods resulting in a combined insured loss of $2.01 billion.

Other provinces in Canada were hit by a drought that led to smaller harvests and poor crop yields, pushing up food prices.

The recent inflation report by Statistics Canada shows that prices for bakery products rose 4.7 per cent year over year due to summer droughts that reduced wheat crop yields, which pushed higher costs onto consumers. Barley, oat and soybean crops were also hit hard by the drought.

Canada is the world's largest producer and exporter of canola, but extremely hot and dry weather conditions have taken a toll on production, causing prices to surge over the past few years.

In 2021, canola production fell to its lowest level since 2007 on poor yields. Farmers in Western Canada planted canola into some of the driest soils in a century. A July heatwave further withered the crops throughout the Canadian Prairies, leading the U.S. Department of Agriculture to lower its estimate of canola output by 4.2 million tonnes to 16 million tonnes, the lowest since the 2012-13 season.

 

At the time, a report by the Canadian Drought Monitor noted that 67 per cent of the Prairie Region was either abnormally dry or facing drought, including 99 percent of the region’s agricultural landscape.

“We're seeing an increased pattern of impacts to production that are currently impacting the capacity of farmers to produce food,” Smukler says. “And this will only get more challenging as we move forward.”

Other than production, there are also other factors that are indirectly contributing to inflated prices.

The future of food policies

Sylvain Charlebois, a researcher, and professor in food distribution and food policy at Dalhousie University says with climate change, two things are happening — the agri-industry is adjusting and looking at new technologies, and governments are implementing policies like carbon taxes to discourage polluters.

Charlebois said such policy measures may actually drive up food prices.

“You have climate change impacting food prices but also policies that mitigate the effects of climate change that are contributing towards high food prices,” Charlebois said in an interview with CTVNews.ca.

Adverse weather events are also impacting animal production. Charlebois says that last year when berries faced a massive drought, farmers had to go south to get grain for their cattle over the winter since they couldn’t grow enough. And again right now, due to transport bottlenecks and severe drought conditions last year, Canadian farmers say they are running out of cattle feed this year.

“It's definitely a very complex issue to deal with since there are so many moving parts,” said Smukler.

He says we have to reduce the amount of greenhouse gases going into the atmosphere, meet our commitments to the Paris Agreement and ensure that all countries are doing their part.

Smukler says that the impact of climate change could be felt for generations.

“We have to learn to adapt to the changes that are on us and those that are coming,” he says. “We need to be able to help our farmers develop strategies to deal with this type of weather volatility.”

“We've just gotten a taste of what is to come,” said Smukler.