The average Canadian family may need to dish out as much as $420 more for food next year — and consumers could have president-elect Donald Trump to thank for part of the price bump, the lead author of a new report says.
Canada’s Food Price Report, published by researchers at Dalhousie University in Halifax, was released Monday evening.
The annual report, which looks ahead to 2017, cites weather disruptions caused by La Nina, energy-related costs — including the potential effect of carbon pricing on the agricultural sector — and a weak Canadian dollar as factors in the expected price hikes.
Economists forecast the loonie could fall as low as 70 cents US in 2017, and a weaker dollar would reduce the buying power of importers.
“Everything we actually import from everywhere will increase in price,” says Sylvain Charlebois, lead author of the report.
‘Trumped’ at the grocery store
But Charlebois, who works with the faculties of management and agriculture at Dalhousie, suggests there’s one more major factor that could contribute to the increase in food prices: the incoming U.S. president.
“We are expecting Canadian shoppers to be Trumped at the grocery store,” said Sylvain Charlebois, lead author of the report.
The report suggests that if Trump’s administration was somehow able to force all illegal workers to leave, the U.S. agriculture industry would be short by as many as two million workers.
“You’re going to see a lot of farmers actually desperate to harvest anything,” said Charlebois.
“That could impact the efficiency of agriculture overall in North America. And because we do import a lot of products from the United States, the cost for these products may actually increase.”
Tom Muller has operated a family farm with his brothers in Yolo County, Calif., since 1969. They grow about 3,200 hectares of diversified crops including processing tomatoes, specialty peppers, cucumbers, walnuts, wine grapes, almonds and more.
“If the undocumented workers in California aren’t allowed to pick fresh fruits and vegetables, it could have a devastating effect on agriculture,” Muller said.
“Not only with getting fresh produce picked on time, and getting it to market, but it’ll also have a huge effect on the agriculture industry to switch to more mechanization — which will put more people out of work.”
Price hikes beyond ‘sweet spot’
The annual report, which has come from the University of Guelph in years past, says the “proverbial sweet spot for food inflation” is between one and two per cent each year. At that rate, the increases are manageable for restaurateurs, grocery stores and consumers, the authors say.
The latest report looks forward to 2017 and finds that food prices could increase between three per cent and five per cent — with meat, vegetables, fish and other seafood projected to jump by as much as four to six per cent. Regionally, Ontario and British Columbia are expected to see most of the increases.
The authors say they rely on an expert panel and, for this first time this year, a machine-learning model, to create the forecast.