Although food prices continued to increase in February, the rate was much more moderate compared to the leaps in prices seen in January, reported Statistics Canada on Friday 18 March. In some parts of Canada, prices for certain fresh fruit and vegetables even dropped.
“Things are going to get better on the food inflation front,” said economist Mike Moffatt, a professor at Western University’s Ivey School of Business.
In January, some food prices, particularly imported fresh vegetables, shot up as much as 22 per cent, the largest year-over-year increase in six years.
Statistics Canada reported a tamer February for food prices with fresh fruit and vegetable prices actually dropping in Western Canada compared to the previous month and increasing only modestly in Eastern Canada.
Both Moffatt and Sylvain Charlebois, an economics professor and member of the University of Guelph’s Food Institute, said grocery shoppers can largely thank the rising Canadian dollar for food inflation easing.
The limping loonie had dramatically plunged, with the collapse over the past year in oil prices, to which Canada’s currency is heavily hitched, but is now trading higher in the upper 70-cents US range.
Statistics Canada, in its monthly inflation report, pegged the nation’s overall inflation rate at just 1.4 per cent in February, tumbling from two per cent in January.
Moffatt said consumers will probably continue to see food prices for vegetables running five to 10 per cent higher than last year, but not 15 to 20 per cent.
Charlebois said Canadian consumers also benefited in February from a milder winter that increased agricultural production.
Food prices that dropped in February compared to the previous month included celery, potatoes, and tea.
Prices that climbed compared to January included carrots, canned sockeye salmon, butter, and processed cheese.
