Canada’s competition watchdog to probe rising grocery prices

Click to play video: 'Is it worth switching grocery stores amid rising food prices?'
Is it worth switching grocery stores amid rising food prices?
WATCH: Is it worth switching grocery stores amid rising food prices? – Oct 22, 2022

Canada’s competition watchdog is launching a study of the grocery industry to examine whether the highly concentrated sector is contributing to rising food costs.

“With inflation on the rise, Canadian consumers have seen their purchasing power decline,” the Competition Bureau said in a news release Monday.

“This is especially true when buying groceries. In fact, grocery prices in Canada are increasing at the fastest rate seen in 40 years.”

Read more: Can a price freeze chill inflation? What to know as grocers fight for your dollar

Grocery prices in September rose at the fastest pace since 1981, with prices up 11.4 per cent compared with a year ago. That compared with an overall inflation rate of 6.9 per cent.

Although the overall inflation rate has begun to drop from its peak of 8.1 per cent in June, food prices have not only outstripped that but continue to rise.

Story continues below advertisement

The Competition Bureau said Monday its study will examine to what extent higher grocery prices are related to changing competitive dynamics in the sector.

Click to play video: 'Grocery hacks for food prices reaching four-decade highs'
Grocery hacks for food prices reaching four-decade highs

It expects to explore how the government could act to combat grocery price increases by way of greater competition in the industry.

It noted that the grocery sector is concentrated, with many Canadians buying from one of three companies: Loblaw, Metro and Sobeys’ parent company Empire Co. Ltd.

Read more: Food prices soared in September even as inflation slowed overall

The level of competition varies across the country, it said.

The Competition Bureau will provide a set of recommendations for the government in its final report, which it plans to publish in June.

Story continues below advertisement

Earlier this month, the House of Commons Agriculture Committee voted to investigate food prices.

The House of Commons also voted unanimously in favour of an NDP motion calling on the government to tackle “corporate greed” in the grocery sector.

Sponsored content