According to Blacklock’s Report, the federal department of agriculture paid for a survey of 3,000 Canadian shoppers and found the typical Canadian family can no longer afford to follow Canada’s Food Guide diet — half of the plate fresh fruits and vegetable, one-quarter whole grains and another quarter protein. (AgCanada suggests mostly plant-based proteins, but that’s a political and ecological fantasy.)
But why are food prices so high? Prices for food have been rising nearly 50 per cent faster than prices for other goods, sometimes twice as quickly. In the end, Canada has the highest food inflation in the G7.
The answer is not price gouging by retailers. Government grocery stores, which have been proposed by the federal NDP and by local politicians such as Toronto Mayor Olivia Chow, would be much worse than private retailers.
Prices would be as high or higher, and selection would be far worse. For one thing, if politicians and bureaucrats ran grocery stores they would care more about politics and ideology than consumer preference. Enjoy a nice steak? Too bad. Cow farts are causing climate change, so Government Grocery no longer sells beef. Grill some lima beans this weekend.
According to the AgCanada survey reported in Blacklock’s, in the past year 71 per cent of Canadians have changed their food purchasing habits because of increasing food prices. Sixty-seven per cent have sought out marked-down items, generic brands or discount supermarkets.
Nearly half, 48.5 per cent, say they have “bought less meat, dairy or fresh produce.” Forty-four per cent have cut back on purchases overall and 36 per cent have bought more canned or frozen foods as substitutes for expensive fresh meat or produce.
Perhaps most disturbing was the finding that in the past six month, 20 per cent of consumers have skipped meals because they couldn’t afford them, while another seven per cent have visited a food bank or taken food from a charity.
So what is causing this?
The problem isn’t producers, wholesalers or retailers putting the screws to consumers to pad their pockets. If anything, those supply-chain players squeeze one another for lower prices or cheaper shipping costs.
The problem is largely government, and particularly in Canada with 11 years of inefficient, bungling Liberal government at the national level.
The causes include market factors, to be sure. Coffee and fuel prices are well over where they were a year ago, two years ago. And beef prices are up one-third or more, although beef remains exceptionally popular, which has driven up demand (and prices).
Yet most of the contributing factors are within the purview of governments, not the private sector. Over regulation and supply management uses government authority to keep prices for dairy, poultry and eggs artificially high, and high taxes reduce the ability of everyone in the supply chain to reinvest in better technology and more efficient production.
Rising costs of production have hit the food industry, for sure. But an $1,800 cheque every year from Ottawa (the Canada Groceries and Essentials Benefit) isn’t going to break the cycle.
If anything, subsidies to consumers drive prices higher even faster.
Take the GST/HST holiday, which ran from December 2024 to February 2025, and the current Canada Groceries and Essentials Benefit. They make no effort to reduce the tax or regulatory burdens on producers, shippers or grocers, which might make food less expensive. Rather they paper over the problem.
If you give every consumer nearly $2,000 to spend on groceries without increasing the supply of groceries, what do you think is going to happen? Suddenly people will have more money to chase the same limited supply of goods. That simply drives up the cost of those goods, in this case groceries.
Governments, especially Liberal governments, think they can solve every problem by throwing money at it. Or at least they hope they can because that makes them look like heroes and helps them avoid tough policy options.
Not going to work.