Canadians Adjust Budgets Due To Rising Food Prices

By: Gary Parkinson on May 20, 2013

Canadians are changing how they spend their cash on food and groceries, according to RBC.  The cost of food has risen year over year since 2010, and a third of Canadians say rising prices will alter their household budgets.

The RBC Canadian Consumer Outlook Index performed the study, and found that 91 percent of shoppers are dissatisfied that a necessary expenditure like food continues to rise.  RBC says that Quebec households spend on average $448 per month on groceries, the highest grocery budget in Canada, while neighbouring Ontario households spend the least per month, at $379.  Over 40 percent of shoppers say they no longer make impulse purchases at the grocery store, and are cutting back on other expenses to pay for food.

In 2010, food prices rose by 1.4 percent.  Prices rose again by 3.8 percent in 2011 and by another 2.4 percent in 2012.  Food industry specialists expect prices to rise again in 2013 as the summer is forecasted to be hot and dry, which will likely lead to droughts, reducing food supply in Canada and the US.  Canadians respond to rising prices by ‘trading down’ in the types of products they buy, such as switching from organic foods back to generic, as well as shopping in lower end stores.

Mustofa Koc, a food security specialist at Ryerson University in Toronto, believes rural and low income Canadians pay the biggest price for rising food costs.

“This usually means looking for more carbohydrates, sugar and fat-laden foods that may keep them stuffed, but likely to cause long term debilitating diet related diseases, such as diabetes, cardiovascular diseases, and arthritis.” 

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