Loblaw Chair Galen G. Weston returned to Ottawa to explain the food price stabilization plan, joining Walmart Canada’s president: “We know we all need to do more to help.” said.
This emergence comes as a new 2024 food price report from Canadian researchers shows that food prices are expected to rise next year, but not at the same pace seen in 2023 as inflation slows. It happened just a few hours after I suggested it.
Researchers estimate that food prices will increase by 2.5% to 4.5% in 2024. According to the report, this translates to a family of four spending $16,297.20 on groceries, an increase of about $701.79 compared to last year.
Loblaw stressed that Weston is working to ease prices on items such as bread, milk, butter and chicken. According to him, these account for his 10 percent of grocery sales at Loblaw stores. Mr. Weston reiterated his point in an earlier committee appearance that Mr. Loblaw could only expect to make a profit of $1 for every $25 sold.
In his opening statement to the committee, Mr Weston said: “While food prices have certainly stabilized and we expect them to continue to do so, we are aware that a food code of conduct could slow this momentum. I’m concerned.”
The code is reportedly nearing completion and aims to be an industry-led document aimed at increasing “fair and ethical trade” across Canada’s food supply chain.
Weston said Loblaw is committed to signing the code, but the current He added that he disagreed with the version.
Where are the increased costs coming from?
Ontario Conservative Party member Leanne Rood said she is a supporter of the code and asked Weston where the rise in food prices was coming from.
“The idea that grocery stores are the problem has shifted the conversation in the wrong direction,” Weston responded.
Loblaw went on to say that the major food companies it works with have reported strong quarterly results related to price increases and has taken Kraft Heinz public, along with Pepsi, Nestlé and Procter & Gamble.
Food prices in Canada are set to rise in 2024, but by how much?
B.C. NDP MP Alistair McGregor focused on Loblaw’s own profits, saying the company’s third-quarter profit was $621 million, up from $556 million a year earlier. In response, Weston said the company’s main goal is to grow and increase profits every year.
“I understand that Canadians feel this pressure. They look at these big numbers and think, ‘If that company wasn’t making as much profit, food prices would go down.’ But that’s not really the case,” Weston said.
When asked about his $11.7 million salary in 2022, Weston acknowledged it was a “big number” but “reasonable given the circumstances of the other executives.” He added that he has “empathy” for people struggling with the cost of living, and said Loblaw has spent $438 million on lowering prices in the past 12 weeks.
Rick Barrichello is a professor at the University of British Columbia, specializing in food economics. He says much of the checkout line’s costs come from further down the supply line. However, he added that it is very difficult to fully understand what the key price drivers are.
“We have tried to consider some of these issues in our research, but it is very difficult to draw conclusions. In some cases, we find results [in] You can find results in one direction and sometimes in the other,” Barrichello said.
“But those who argue that there should be more competition in the grocery space, of course that’s a valid argument. A very valid argument.”
Ontario Conservative Party leader Dave Epp asked Weston about the impact the federal carbon price would have on grocery prices, and Weston said Loblaw stores don’t deal with carbon prices directly, so he couldn’t provide specific information. He said he did not have one, but added that anything that would put cost pressure on the system should be eliminated. I saw it.
The Conservatives use carbon pricing (often referred to as a “carbon tax”) to attack the Liberals over rising food prices, arguing that it increases production, manufacturing and transportation costs.
Shortly after, Ben Carr of the Manitoba Liberal Party asked about the impact of climate change on prices. Weston did not provide specific numbers, but said he was seeing a “meaningful impact” on a weekly basis.
In this regard, Barrichello said that his and colleagues’ research found that energy prices were not a “significant driver” of the overall cost of groceries.
Alberta man encounters gunman in Kingsway Mall crime spree
Experts warn the US is headed for a ‘syndemic’ this winter
“You’re talking about a small component of the cost, and you’re talking about a small component added by the carbon tax. So when you multiply those two small percentages together, it’s a trivial amount. “It becomes a factor,” he said.
Barrichello added that while climate change will have a significant impact on food prices in the long term, he does not think it will have a significant impact on price inflation in the short term.
There are many factors that determine food prices, but world market prices also play a role. Barrichello said these could be affected by a number of unforeseen events, such as rising grain prices due to Russia’s invasion of Ukraine, but globally prices were stabilizing.
“These prices vary widely internationally. And also, with the exception of perhaps sugar and rice these days, they’re decreasing on average. And that’s not because of climate change. It’s because [Indian] Export ban,” he said.
“We’re doing ‘everything we can’: CEO of Walmart Canada.”
Prior to Mr. Weston’s appearance, Gonzalo Guevara, CEO of Walmart Canada, appeared before the committee remotely.
When asked about the company’s concerns about the upcoming grocery store code of conduct, Guevara said he believes it is already living up to that spirit by maintaining strong relationships with its suppliers.
In response, Ontario Liberal MP Leah Taylor-Roy asked Guevara what else Walmart could do to alleviate affordability challenges.
“I hope you can trust that we are doing everything we can to operate as tightly as possible in order to continue to offer the lowest prices on the market,” Guevara responded.
Could a grocery store code of conduct lower food prices?
Mr. Guevarra maintained that he views Canada’s grocery market as competitive, and told the committee the provision would increase bureaucracy and business costs.
Loblaw also said he could not support the code in its current draft, as it would further fuel food inflation. Although this claim has been made several times by the grocer, there is no clear evidence presented by the grocer regarding this.
In the run-up to Thanksgiving, Innovation Minister François-Philippe Champagne called on Canada’s major grocers to do more to stabilize prices by Thanksgiving, or the government would take action. Stated.
This could include ongoing competition law reforms and potential tax measures.
In late October, Mr. MacGregor led a motion before the committee to recall grocery store managers to the committee to lay out their plans and testify again.
Details of the plan are expected to be withheld due to competition implications, but committee members will be allowed to view it privately.
— With files from The Canadian Press.