High grocery prices 'inherent to the Canadian system': food economist
BNN Bloomberg
,Following meetings between government officials, grocers and manufacturing companies around at stabilizing food costs, a food economist said conversations about food supply chains should be broad and inclusive to get at the heart of the issue.
Mike von Massow, a food economist and associate professor at the University of Guelph, told BNN Bloomberg it’s important for players at all levels of the supply chain to be involved in the discussions in order to have a “fulsome” picture of what is taking place.
“It’s important to have the broader conversations,” von Massow said in a Tuesday interview.
“Frankly, I would have had them even more broad, and included some of the producer groups, so that we have a complete picture of what's going on in the supply chain.”
The expert’s comments came after the federal government held meetings on the topic of stabilizing food prices with top grocery executives at Loblaw, Metro, Empire, Walmart and Costco, and with leaders at manufacturing companies including McCain, NestlĂ© and Kraft Heinz.
Industry Minister François-Philippe Champagne said grocery executives agreed to take action to stabilize food prices and that their plans will be presented next month.
In another bid to tackle high food costs, the federal government also tabled the “Affordable Housing and Groceries Act” last week. The legislation attempts to maintain competition in the grocery industry and expands powers for the Competition Bureau to investigate price fixing.
In a recent BNN Bloomberg interview, former Liberal deputy prime minister John Manley criticized the government’s moves aimed at stabilizing food prices. He disagreed with the focus on grocery stores and said if the federal government was serious about its efforts, it would focus on supply management instead.
FOOD PRICES IN CANADA
Food inflation remains high in Canada. However, von Massow noted that prices have declined in two of the last three months despite elevated prices on an annual basis – a trend he said should provide “some hope” for consumers.
According to von Massow, there are several factors “inherent to the Canadian system” that contribute to higher prices.
“None of these things are going to be big magic bullets to bringing food prices down. But I think things like interprovincial trade barriers are small things that we could do to improve not only the food prices but the prices of many other things as well,” he said.
Some of these factors include labour costs in Canada that are higher relative to the U.S.
“That comes into play regardless of where we are in the food system, at restaurants, at retail (or) at processing.” von Massow said.
He also noted that logistic costs are more expensive in Canada due to fuel costs, as well as from a “distance travelled perspective.”
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