The rising cost of groceries, gas and cars helped push Canada’s inflation rate to an 18-year high in October as the consumer price index (CPI) posted a 4.7 per cent increase from a year earlier.
The increase marks the largest year-over-year gain in inflation since February 2003.
Energy prices grew 41.7 per cent since October of last year. Transportation costs posted a 10.1 per cent annual gain.
Meat prices rose nearly 10 per cent year-over-year — including a 20.2 per cent increase in bacon — as labour shortages and logistics issues hampered supply.
The rising cost of living has provoked concern among Canadian consumers and businesses as supply chain backlogs and labour shortages threaten to embed high inflation into the national economy for months to come.
“We’re just beginning to see the upward pressure on prices,” warned Philip Cross, a senior economist at the Macdonald-Laurier Institute, pointing to increased consumer demand and a struggling supply chain system.
Canadians’ grocery bills are rising at an overall 3.9 per cent annual pace, according to Statistics Canada.
Meat prices were the leading cause of food inflation, according to the CPI. A prime rib roast costs 27.5 per cent more than it did a year earlier. Frozen beef rose 14 per cent.
Rising food costs extended to other items including a 7.2 per cent increase in the price of eggs and a 7.1 per cent increase for orange juice. Coffee, cooking oils and wheat products also faced significant upwards price pressure.
“Labour shortages that have slowed down production, ongoing supply chain challenges and rising prices for livestock feed continued to factor into higher prices for meat,” the data agency said on Wednesday.
Fresh produce and vegetables faced a price decrease over the summer as local farmers benefitted from harvest-friendly weather, but recent supply chain woes have pointed to a potential hike in the coming months.
Canadian wholesalers have reported that imported produce such as grapes, berries and citrus are stuck in shipping containers at ports along North America’s east coast entry points while truckers wait in line to transport them across the Canada-U.S. border.
“We caught a break with good weather for crops this year, but that changes when we look to import food from abroad in the winter months,” Cross said.
The Ontario Produce Marketing Association (OPMA) recently told the Star that fresh produce imported from South America and Asia is taking more than a week longer than usual to arrive at Toronto’s Ontario Food Terminal, Canada’s largest wholesale fruit and distribution centre.
In a joint statement, companies in the North American produce industry warned that supply chain issues and a shortage of truck drivers and other labourers “will create long lasting impacts ... these include: bankruptcies, legal disputes, industry consolidation, inflation, inaccessible food supplies, and many more.”
In a conference call on Wednesday, Metro CEO Eric La Flèche told analysts that food manufacturers facing inflationary pressures will pass along cost increases to grocers.
“There are cost increases coming because of commodity issues, weather issues and labour costs at the vendor end,” he said.
Michael Graydon, CEO of Food, Health & Consumer Products of Canada, says the rising cost of living can be a “tipping point” for low-income Canadians struggling to make ends meet.
“When you’re on a fixed income, these costs are especially extreme. It’s what can lead Canadians to turn to food banks or government subsidies,” Graydon said.
The CPI’s growth rate in October marked the seventh month in a row that Canada’s primary inflation metric has risen beyond the Bank of Canada’s target inflation range of one to three per cent.
The central bank has said it expects CPI inflation to average 4.8 per cent in the fourth quarter of 2021, and to average 3.4 per cent in 2022. It expects inflation to return to its two-per-cent inflation target by late 2022.
Yes, your groceries do cost more — Canada’s inflation rate sees biggest jump since 2003 in October - Toronto Star
Read More
No comments:
Post a Comment