REPORT from OTTAWA Rapport d’Ottawa

by/par Carol Hughes Federal member of Parliament Algoma-Manitoulin-Kapuskasing

This week, Statistics Canada's Consumer Price Index examination shows that inflation is finally starting to decelerate, with costs rising 2.8 percent,amongtheslowestgrowthinoverayearand-a-half, and near where target inflation generally should be. Many goods, including transportationandtelecommunicationscosts,have slowedsignificantly.However,itlikelydoesn'tfeel likepricesarecomingdownifyou'verecentlyleft thegrocerystorecheckout.Thisisbecause,unlike other areas of the economy, food costs remain persistently high at a 9.1 percent year-over-year increase.

Manyofthefooditemsthathaveincreased by a significant amount are staples. The cost of meat has risen 6.9 percent year-over-year, bakery productshaverisenby12.9percent,dairyproducts by 7.4 percent, and fresh fruit has risen by 10.4 percent year-over-year,with theprice ofgrapes in particular rising an astonishing 30 percent monthover-monthfromMaytoJune.Whenthecostsfor the most important food items required for nutrition continue to rise without a sign of slowdown, slowing inflation in other areas of the economy doesn't make survival feel any more affordable.

Whatdowedotostartcurbingthecostsoffoodin Canada?Obviously,therearefactorsthatwecan't control, such as Russia's recent cancelling of the BlackSeagraindealthatmayhavelastingimpacts onthepriceofbreadandbakeryproducts,butthere arethingsthatwecandotocurbfoodinflation.

AttheendofJune,theCompetitionBureau of Canada released its much-anticipated Retail GroceryMarketStudy,whichexaminedthestateof competition(ormoreprecisely,thelackthereof)in the grocery industry, with the on-the-nose title Canada Needs More Grocery Competition. In the report, the Competition Bureau states “In recent years, industry concentration has increased, and it hasbecomemoredifficultthaneverforbusinesses to enter, expand, and compete effectively. Furthermore,thepriceCanadianspayforgroceries has been rising fast. Factors such as higher input costs, Russia's invasion of Ukraine, and supply chain disruptions have contributed to recent increasesinthepriceoffood.Butwehavealsoseen a longer-term trend that pre-dates those events, of Canada's largest grocers increasing the amount theymakeonfoodsales.”

The Competition Bureau has put forward fourveryclearrecommendations thattheybelieve will bring more competition to grocers and bring prices down.This includes: developing a Grocery InnovationStrategythatencouragesnewplayersin the market to develop different strategies for getting food to consumers, such as online shopping; federal, provincial, and territorial support for independent and international grocers toenterthemarkettodrivecompetition andlower prices; having the provinces and territories