Trudeau calls on major grocers to stabilize food prices, drawing industry pushback
The federal government is demanding major Canadian grocers come up with a plan to stabilize prices, drawing pushback from the food industry.
Prime Minister Justin Trudeau on Thursday said the call comes as Canadians continue to struggle with inflation.
“Large grocery chains are making record profits. Those profits should not be made on the backs of people who are struggling to feed their families,” he said, speaking in London, Ont., following a caucus retreat.
He said the government will be asking the five largest grocery companies, - Loblaw, Metro, Empire, Walmart and Costco - to come up with a plan by Thanksgiving.
“If their plan doesn't provide real relief for the middle class and people working hard to join it, then we will take further action and we are not ruling anything out including tax measures.”
The call comes as grocery prices rose 8.5 per cent year-over-year in July, showing a slight easing of price growth but still running much hotter than overall inflation at 3.3 per cent. August inflation data is scheduled for release on Tuesday.
Major grocers have been facing accusations of profiteering amid high inflation, though executives from the companies denied these allegations before a parliamentary committee studying food inflation earlier this year.
On Thursday, Loblaw and Metro directed requests for comment to the Retail Council, with Loblaw spokeswoman Catherine Thomas saying the grocer is “always open to discussions about what more can be done across the industry.”
The Retail Council of Canada said in a statement that grocer prices and profits have nothing to do with rising food prices, pointing instead to higher costs being passed on from food manufacturers and producers.
The group said that any discussions on food pricing need to also include processors, manufacturers and other relevant businesses along the supply chain.
“We are not going to take part in discussions that time and time again fail to look below the surface as to the true cause of rising grocery prices,” said spokeswoman Michelle Wasylyshen.
It's not clear what such a plan from the grocers would look like, or how the government would measure its success, said Michael von Massow, a food economy professor at the University of Guelph in Ontario.
“I am disappointed that we didn't get more detail in what the government is asking,” he said.
“It just feels a little bit half-baked.”
While it's easy to blame grocers, there are factors that have been driving food prices up along the whole supply chain, said von Massow, such as the war in Ukraine and extreme weather events.
“If they wanted to engage with the food industry broadly to find ways to do (lower prices), maybe they could. But to me, this isn't the way to go about it.”
Industry Minister Francois-Philippe Champagne, who is taking the lead on the grocery price push, said at Thursday's press conference that the government would also be engaging other segments of the food industry.
“We're going to start with the five largest grocers in Canada represent about 80 per cent of the market, and we're going to be in solution mode with very clear deadlines and very clear outcomes for Canadians. And together we're going to look also at large food processors,” he said.
“We're going to bring them in Ottawa, talk to them around meaningful action and if they fail to do so there'll be consequences.”
Anthony Fuchs, spokesman for Food, Health & Consumer Products of Canada, which represents food producers, said in a statement that both the timing of the announcement and the threat of tax measures were concerning.
“We believe that using taxation as a punitive measure on retailers, especially at this time, is not only ill-advised but might have a detrimental ripple effect on the whole food supply chain, including food producers,” said Fuchs.
“Today's announcement, which proposed a broad approach to a nuanced issue, may lead to unintended consequences.”
An industry committee has been working on a grocery code of conduct that aims to level the playing field along the grocery supply chain in Canada.
The code of conduct was proposed as a way to address issues in the sector, particularly between grocers and their suppliers, such as arbitrary fees and sudden cost increases.
In June, the Competition Bureau released a highly anticipated study saying Canada's grocery sector needs more competition to help keep food prices down as well as provide more options and encourage new entrants to the industry.
Von Massow said if the big five grocers do come up with a plan to lower their prices, that could also inadvertently compete with the Competition Bureau's recommendation to foster independent grocers.
Gary Sands, senior vice-president with the Canadian Federation of Independent Grocers, questioned where independent smaller retailers fit into the picture.
“How do we come up with a plan, when we don't have the leverage to negotiate with suppliers on price increases that they're passing on?” he asked.
“We are facing a myriad of price increases from suppliers, but we don't point the fingers at the suppliers, either, as all those other factors ... are driving up costs.”
This report by The Canadian Press was first published Sept. 14, 2023.
IN DEPTH
Budget 2024 prioritizes housing while taxing highest earners, deficit projected at $39.8B
In an effort to level the playing field for young people, in the 2024 federal budget, the government is targeting Canada's highest earners with new taxes in order to help offset billions in new spending to enhance the country's housing supply and social supports.
'One of the greatest': Former prime minister Brian Mulroney commemorated at state funeral
Prominent Canadians, political leaders, and family members remembered former prime minister and Progressive Conservative titan Brian Mulroney as an ambitious and compassionate nation-builder at his state funeral on Saturday.
'Democracy requires constant vigilance' Trudeau testifies at inquiry into foreign election interference in Canada
Prime Minister Justin Trudeau testified Wednesday before the national public inquiry into foreign interference in Canada's electoral processes, following a day of testimony from top cabinet ministers about allegations of meddling in the 2019 and 2021 federal elections. Recap all the prime minister had to say.
As Poilievre sides with Smith on trans restrictions, former Conservative candidate says he's 'playing with fire'
Siding with Alberta Premier Danielle Smith on her proposed restrictions on transgender youth, Conservative Leader Pierre Poilievre confirmed Wednesday that he is against trans and non-binary minors using puberty blockers.
Supports for passengers, farmers, artists: 7 bills from MPs and Senators to watch in 2024
When parliamentarians return to Ottawa in a few weeks to kick off the 2024 sitting, there are a few bills from MPs and senators that will be worth keeping an eye on, from a 'gutted' proposal to offer a carbon tax break to farmers, to an initiative aimed at improving Canada's DNA data bank.
Opinion
opinion Don Martin: Gusher of Liberal spending won't put out the fire in this dumpster
A Hail Mary rehash of the greatest hits from the Trudeau government’s three-week travelling pony-show, the 2024 federal budget takes aim at reversing the party’s popularity plunge in the under-40 set, writes political columnist Don Martin. But will it work before the next election?
opinion Don Martin: The doctor Trudeau dumped has a prescription for better health care
Political columnist Don Martin sat down with former federal health minister Jane Philpott, who's on a crusade to help fix Canada's broken health care system, and who declined to take any shots at the prime minister who dumped her from caucus.
opinion Don Martin: Trudeau's seeking shelter from the housing storm he helped create
While Justin Trudeau's recent housing announcements are generally drawing praise from experts, political columnist Don Martin argues there shouldn’t be any standing ovations for a prime minister who helped caused the problem in the first place.
opinion Don Martin: Poilievre has the field to himself as he races across the country to big crowds
It came to pass on Thursday evening that the confidentially predictable failure of the Official Opposition non-confidence motion went down with 204 Liberal, BQ and NDP nays to 116 Conservative yeas. But forcing Canada into a federal election campaign was never the point.
opinion Don Martin: How a beer break may have doomed the carbon tax hike
When the Liberal government chopped a planned beer excise tax hike to two per cent from 4.5 per cent and froze future increases until after the next election, says political columnist Don Martin, it almost guaranteed a similar carbon tax move in the offing.
CTVNews.ca Top Stories
Judge in Trump's hush money trial threatened to throw witness out of court for behavior on stand
Michael Cohen testified Monday that he stole tens of thousands of dollars from his ex-boss Donald Trump’s company, an admission defence lawyers hope to use to undermine Cohen’s credibility.
What is BORG drinking, and why is it a dangerous trend? An expert explains
If you've been to a party lately and haven't seen someone drinking a BORG, you're likely not partying with college students.
The world's best airline is paying staff a bonus of 8 months' salary
Singapore Airlines will reward its employees with a bonus worth nearly eight months of salary, a person familiar with the matter told CNN on Friday.
Oilers win Game 7 over Canucks, advance to Western Conference Final
The Edmonton Oilers weathered a late Vancouver Canucks charge on Monday night, beating the hosts 3-2 to win their seven-game second-round playoff series in the decisive showdown.
McGill says pro-Palestinian protest outside senior administrator's home 'crosses the line'
McGill University has denounced a pro-Palestinian protest held Sunday outside the home of one of its senior administrators.
Red Lobster probes 'endless shrimp' losses after bankruptcy filing
U.S.-based restaurant chain Red Lobster has filed for Chapter 11 bankruptcy protection in a Florida court after securing $100 million in financing commitments from its existing lenders, the company said on Sunday.
Katy Perry sings goodbye to 'American Idol'
Katy Perry said her goodbyes on 'American Idol' after seven seasons. On Sunday night’s live 'idol' season finale, a medley of Perry's hit songs were performed, including 'Teenage Dream,' 'Dark Horse' and 'California Gurls.'
Microsoft's AI chatbot will 'recall' everything you do on a PC
Microsoft wants laptop users to get so comfortable with its artificial intelligence chatbot that it will remember everything you're doing on your computer and help figure out what you want to do next.
Judge cites error, will reopen sentencing hearing for man who attacked Nancy Pelosi's husband
A federal judge will reopen the sentencing hearing for the man who broke into Nancy Pelosi's San Francisco home and bludgeoned her husband with a hammer after the judge failed to allow him to speak during his court appearance last week.
Local Spotlight
VIDEO Born without front legs, this dog has been inspiring the world for 3 years: Dresden farm owner
A sanctuary dedicated to animals with disabilities is celebrating the third birthday of one of its most popular residents.
7-year-old Pokémon prodigy heading to Hawaii for world championship tournament
Catching 'em all with impressive speed, a 7-year-old boy from Windsor, Ont. who only started his competitive Pokémon journey seven months ago has already levelled up to compete at a world championship level.
From DVDs to rehearsals: Halifax theatre company transforms Video Difference building into arts hub
2b Theatre recently moved into the old Video Difference building, seeking to transform it into an artistic hub, meeting space, and temporary housing unit for visiting performers in Halifax.
'Another pair of eyes watching over me:' How a B.C. woman's service dog saved her from drowning
A B.C. woman says her service dog pulled her from a lake moments before she had a seizure, saving her life.
Starbucks fan on decades-long journey to visit every store in the world
A Starbucks fan — whose name is Winter — is visiting Canada on a purposeful journey that began with a random idea at one of the coffee chain's stores in Texas.
'Sacred work': Sask. First Nation learning how to conduct its own underground searches
Members of Piapot First Nation, students from the University of Winnipeg and various other professionals are learning new techniques that will hopefully be used for ground searches of potential unmarked grave sites in the future.
'It could mean a cure': Cautious optimism for groundbreaking ALS research at Western
ALS patient Mathew Brown said he’s hopeful for future ALS patients after news this week of research at Western University of a potential cure for ALS.
B.C. musician's song catches attention of Canucks
When Adam Kirschner wrote 'Slap Shot,' he never imagined the song would be embraced by his favourite team.
'We're on standby': Team ready to help entangled right whale in Gulf of St. Lawrence
A team is ready to help an entangled North Atlantic right whale in the Gulf of St. Lawrence.