RCC’s response to PM’s call on large grocers to stabilize grocery prices

Retail Council of Canada and its grocery members understand that Canadians are struggling as they face this exceptional cost of living crisis. That’s why grocers continue to do what they can – including very publicly pushing back on suppliers – to stabilize food prices, leading to some of the lowest food price inflation rates in the world.

Anyone who understands the grocery sector knows why food prices have gone up. Numerous reports over the past year, including those from Statistics Canada, the Bank of Canada, and the Canada Food Report 2023 have studied this issue and have concluded that grocer prices and profits have nothing to do with it. Simply put, the price on grocery shelves is driven by increased vendor costs from food manufacturers and producers, itself caused by a host of global factors – including supply chain challenges, the war in Ukraine, fuel prices, and climate events.

Rather than casting blame where the experts agree it does not belong, the federal government should look in the mirror. The government could take a number of steps to make food more affordable, including temporarily removing the carbon tax from farmers, food processors and distributors and cancelling government’s planned plastic packaging targets that could increase costs to grocers by $6 billion a year.

Grocers are always prepared to have good faith discussions with government about our industry, challenges with the food supply chain or with affordability for Canadians. But we are not going to take part in discussions that time and time again fail to look below the surface as to the true cause of rising grocery prices. In order for any future discussions to be credible, they must include not only food retailers, but also processors, manufacturers, (including those in supply managed categories) as well as other relevant businesses within the supply chain. Any conversation that doesn’t include the vendors, whose costs make up more than 70% of the price to customers, will not provide meaningful outcomes.