Higher grocery bill? Here’s why some food prices may be rising in Canada

Metro's CEO said last week that the company was expecting it would have to pass on some higher costs from suppliers as an industry-wide blackout period for price hikes would end.

Canadians that have turned to grocery store flyers and coupon-cutting may need to look for even more savings.

Last week, Metro CEO Eric La Flèche told analysts on an earnings call that the company was expecting it would have to pass on some higher costs from suppliers as an industry-wide blackout period for price hikes would end starting Feb 1.

That period, food researcher and Dalhousie University Agri-Food Analytics Lab director Sylvain Charlebois said, is often seen from November until January but when it ends, Canadians are left with the bill.

“So the blackout period, of course, leads to higher prices, and fees a few months later leads to more higher food prices,” Charlebois said. “I don’t see any benefit for consumers at this point.”

The price increases come from suppliers, but when the freeze ends, the costs are often passed on to consumers.

In an email to Global News, the Retail Council of Canada (RCC), a non-profit association that represents retailers including Canadian grocers, said it was common for some grocers to “push back on vendor price increases” from the period just before Christmas until shortly after.

Spokesperson Michelle Wasylyshen also said that grocers are food distributors: they buy goods from suppliers and sell to customers. That means they’re largely dependent on what they are asked to pay for the products.  According to the RCC, 70 to 80 per cent of checkout prices arise from vendors before the food even gets to grocers.

Food economist from the University of Guelph, Mike von Massow, said the issue faced with price freezes is they can “bite in two directions.”