A new survey shows that Canadians believe profiteering is the main reason food prices are higher, despite grocery store CEOs testifying otherwise.
The report was done by Dalhousie University’s Agri-Food Lab in partnership with Caddle, and surveyed close to 10,000 Canadians at the end of March.
It found that in all provinces except Saskatchewan and Quebec, grocery chain price gouging was chosen as the main reason food prices have risen in Canada recently. Nova Scotians chose that reason the most, at 51.8 per cent, followed by Newfoundland and Labrador at 38.1 per cent, and Prince Edward Island at 36.1 per cent.
Other provinces trailed a little above 30 per cent in choosing that reason, with those in Saskatchewan and Quebec choosing it the least.
Overall, 30.3 per cent of Canadians believe price gouging is the main reason for higher food prices, while 29.9 per cent believe inflation/monetary policies are to blame.
The results come after CEOs from Loblaw, Metro, and Empire Co., which operates Sobeys, Safeway and FreshCo, appeared before a parliamentary committee in March and testified under oath that they were not profiteering off of higher grocery prices.
“Reasonable profitability is an important part of operating a successful business,” said Loblaw Companies CEO Galen Weston Jr. when asked by NDP Leader Jagmeet Singh if there is any limit to profits they can make. Singh has repeatedly accused grocery chains of profiteering off of inflation.
Weston stated several times during his testimony that his company makes $1 in profit for every $25 sold.
An analysis from Dalhousie University’s Agri-Food Analytics Lab published in November found all three top grocers beat their five-year averages for profit in the first half of 2022, with Loblaw beating its previous best results for the period by $180 million.
Weston, though, said he disagreed with that report’s findings. All three CEOs said their profit margins haven’t changed and that more money is made from pharmacy and other non-food sales.
The recent survey found that only 35 per cent of respondents followed the parliamentary proceedings, and of those who did, only 32.9 per cent felt grocers were convincing during testimonies, and 24.7 per cent felt grocers were transparent and forthcoming.
“The data is suggesting that (the CEOs) didn’t move the needle at all when it comes to trust,” Sylvain Charlebois, the director of the Agri-Food Lab, told 640 Toronto.
David Mcdonald, a senior economist with the Canadian Centre for Policy Alternatives who has been researching food inflation, told Global News that there isn’t detailed data available that can prove the CEOs right, so the public just has to take their word on it.
He said that while it is true their profits are up, other parts of the supply chain are guilty of profiteering, mainly the oil and gas industries.
“There’s a lot of diesel involved in the transportation of goods and farming,” he said. “The margins are way up in oil and gas, and that finds its way into the price of broccoli.”
— with files from Craig Lord and 640 Toronto
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