How the Iran war impacts your grocery bills: ‘Everything is going to go up’

Sustained pressure on oil prices could mean Canadians will pay significantly more at the grocery store by the end of this month, one expert said.

The Iran war has already raised energy prices globally, with the price of crude oil going past US$100 a barrel, but some experts are warning that the pain will also be felt soon at the grocery aisle.

While a relatively small portion of Canada’s food imports move through the Strait of Hormuz, where traffic has come to a virtual halt amid the war, University of Toronto professor and supply chain expert Andre Cire says skyrocketing oil prices will have an impact on food prices in Canada.

“Energy is in everything. You need to transport food from one place to the other, you need to put fuel in those ships. We’re going to start seeing some increase in food prices as well, just because the transportation costs are going to go up,” he said.

Sustained pressure on oil prices could mean Canadians will pay 10-15 per cent more at the grocery store by the end of this month, Cire added.

“This has an impact on freight costs,” he said.

The longer the crisis continues, the harder it’s going to get to ship anything anywhere, says University of Guelph food economist Mike von Massow.

“If it’s taking more days to ship things, then we might see both an increase in freight or at least a delay in freight coming through. That supply chain disruption could have some ripple impacts beyond just products that move through the Strait of Hormuz,” he said.

In the short term, Canadians may start to pay more for certain kinds of rice at the grocery store.