The cost of food has become a major concern for many Canadians this year and, unfortunately, a new report predicts that food prices will continue to surge in 2023. According to Canada’s Food Price Report 2023, food prices are expected to increase up to $1,065 from what was observed this year.
“To say that it’s been a challenging year for Canadians at the grocery store would be an understatement,” says Dr. Sylvain Charlebois, project lead and Director of the Agri-Food Analytics Lab at Dalhousie University, in a news release on the report. “Consumers will continue to get smarter about grocery shopping as they navigate through this so-called food inflation storm.”
How much will Canadian food spending go up in 2023?
Many Canadians have already made shifts in their food spending habits this year as grocery bills have surged due to factors like inflation, shrinkflation, shelfation and more — so how much will food prices and spending really increase in the year to come?
The report predicts a 5 per cent to 7 per cent increase in food prices in 2023. For an average family of four (in this case, the family is defined as “a man (age 31-50), woman (age 31-50), boy (age 14-18) and girl (age 9-13)”) food spending is forecasted to increase by up to $16,288.41 per year, which is “an increase of up to $1,065.60 from what was observed in 2022.”
Which areas of the grocery store will see prices surge the most? The report predicts that the “most substantial” increases will be in the prices of vegetables, dairy and meat (which means almost everyone who eats food will be impacted).
What is ‘Canada’s Food Price Report’?
Canada’s Food Price Report is an annual collaboration between a cross-country research team featuring research partners from Dalhousie University, the University of Guelph, the University of Saskatchewan and the University of British Columbia. To create the report, the research team uses a combination of sources and methods, including “historical data sources, machine learning algorithms, and predictive analytics tools developed over many years to make predictions about Canadian food prices.”
For the 2023 report, the team used a new forecasting model. “It includes historical data plus the additional variables of forecasted inflation and Canadian-US exchange rate,” says Dr. Kelleen Wiseman, UBC campus lead, in the news release. “This resulted in a rebalance between past data and future forecasts. Forecasting food prices is challenging!”
Why are food prices going up for Canadians?
As we head into 2023, there are multiple factors that, especially when combined, are driving the cost of food up for people all across Canada — which the report aims to reflect and unpack for consumers.
“Each year, the Canadian Food Price Report provides consumers with important information on how the coming year might affect them in terms of food prices and affordability,” says Andrea Rankin, the Master of Public Administration candidate at Dalhousie University who worked on the 2023 report, in the release. “It also gives important context for why prices are changing. Climate change, supply change disruptions, carbon taxes, geopolitical climates and rising transportation costs are all contributing factors.”
While the rising cost of food is certainly a concern for Canadians as we move into 2023, they may not be quite as bad as the increases that we’ve already seen in 2022.
“We haven’t seen food prices increase this high in Canada for over 40 years and based on our findings, the increases we have predicted are still quite high but not as high as the increases for 2022,” says Dr. Simon Somogyi, University of Guelph campus lead. “That may be cold comfort for Canadians, as food prices are already high, but if inflation can come down, it’s possible that we could see price increases for 2023 at or below 5 [[er cent].”
To learn more, you can read the complete Canada’s Food Price Report 2023 here.
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