Prime Highlights:

• Canada is seeing the biggest food inflation boost in 50 years, with food prices rising 10.8% year-over-year.
• Shoppers are altering their buying behaviors, purchasing on sale and valuing affordability over nutrition.

Key Facts:

• Canadian food prices have increased 10.8% in the last year, the quickest growth in more than 40 years.
• A record 24% of Canadians are reducing food expenditures due to prices being out of sight, disproportionately impacting women and children.

Background:

Canada is experiencing its record half-century high food inflation rate. Food prices have increased 10.8% compared to last year, ahead of the general 7.0% inflation rate, as reported by Statistics Canada. The steep increase is fueled by the likes of global supply chain disruptions, poor weather conditions for crops, and increased transportation costs. The food price increase is severely impacting family budgets nationwide.

A Dalhousie University’s Agri-Food Analytics Lab and Caddle survey discovered that almost 24% of Canadians are purchasing less food due to its higher cost. This is especially alarming since it is disproportionately affecting women, with almost 70% of women being among those affected shoppers. The higher costs have caused 8.2% of Canadians to modify their diets in the hopes of saving money, and 7.1% say they skip meals. Moreover, children’s diet has been significantly impacted by food price inflation, with families giving priority to the staple foods. In response to the inflation trend, Canadians are altering their shopping patterns.

Approximately 74% are adapting the way they shop, while almost 34% are utilizing loyalty program points and 32% scanning flyers more intensely. In addition, 23.9% are shopping groceries at warehouse facilities such as No Frills or FreshCo, and 11.5% are going for the dollar store option in groceries. Out of their way to save even more, approximately 18% of Canadians are purchasing food in bulk, and 40.6% are seeking to reduce food waste. In Atlantic Canada, almost 29.1% of customers have resorted to low-cost substitutes, especially goods near expiration dates. This action indicates growing pressure on Canadian families to make tough financial decisions as food increases in price, with younger communities such as Gen Z taking the brunt. The generation is especially hit, with 46% falling into debt or accessing savings in order to afford food.