Groceries remain costly as inflation slows down in Canada

For consecutive months, inflation has dropped in Canada, but the cost of groceries remains high.

Statistics Canada announced Tuesday that the inflation rate was 7.0 per cent in August, down from 7.6 per cent the month prior.

Gas prices dropped 9.6 per cent compared to July, with Statistics Canada determining that was the main factor for the slight drop in inflation around the country.

Despite the drop, the cost of food remains high for many Canadians.

Grocery prices are up 10.8 per cent compared to August of last year; that’s the highest rate seen in Canada since 1981.

Dr. Sylvain Charlebois, project lead and director of the Agri-Food Analytics Lab at Dalhousie University, was disappointed that the cost of food remained high despite the increasing optimism towards inflationary pressures in Canada.

“We were expecting better numbers this time around, but we didn’t get them,” Charlebois said. “We’re hoping that things will ease by the time we’re done with 2022.”

Extreme weather, the war in Ukraine and supply chain disruptions from the pandemic are the main factors still impacting the food industry, according to Charlebois.

“Unfortunately, everything that has happened is coming back to haunt us and food inflation is still lingering,” he said. “The food industry is still dealing with many macroeconomic pressures, essentially logistically with the grain market.

“It’s been complicated and I think we’ve underappreciated how complicated things have been for the food industry in the last two (or) three years.”

According to the latest inflation report, Canadians are paying 6.5 per cent more for meat and 7.0 per cent extra for dairy products. Bakery products are costing 15.4 per cent more, fresh fruit is up 13.2 per cent, non-alcoholic beverages are up 14.1 per cent and condiments, spices and vinegars are up 17.2 per cent compared to this time last year.

Charlebois says many people are taking a greater approach to getting cheaper groceries.

“People are coping in many different ways,” he said. “Many people are shopping elsewhere; they’re visiting more stores to find deals.

“There is also a sense of desperation out there as 24 per cent of Canadians actually are buying less food than a year ago just because of higher food prices, so you can see that inflation is impacting many, many Canadians.”

That desperation Charlebois is referring to could have an impact on people’s credit cards as well.

“Seven per cent of  Canadians are using their credit cards to buy groceries without knowing when they’ll be able to repay their balance,” he said.

Saskatchewan’s inflation rate fell to 6.8 per cent in August from 8.1 per cent in July.