How to address food inflation

As farmers, we’ve escaped the brunt of public scrutiny over rising food prices. Most of the finger pointing has been at the big grocers for what some call greedflation. In truth, rising food prices are caused by many factors and this includes what farmers are paid.

The record high grain prices of the past couple years are trending downwards now, but they no doubt contributed to food price inflation that’s been running even higher than the general inflation rate.

We typically decry the farmers’ small portion of retail food prices, but a dramatic rise in raw material prices will always ripple through the system.

When $20 a bushel was available for your canola and durum, did you ever tell the buyer that was too high and offer to take $18 instead? Me neither.

It’s only logical to maximize returns even when prices are far above cost of production. After all, many times the market is paying below cost of production. Farmers are price takers with no reason to look a gift horse in the mouth.

Beef prices at retail have long been sky high, with both packing plants and retail outlets viewed as the villains. As grain prices sag a bit, cattle prices have strengthened and the outlook is more optimistic than it’s been in a long time. This will also ripple through the food chain.

Food prices have increased around the world with a multitude of factors involved – the end of the pandemic, supply chain disruptions, weather issues, the war in Ukraine, increasing transportation costs.

The big grocers may have taken advantage of the situation to ratchet up their profit levels, but public enquiries and grandstanding politicians are unlikely to change anything. When price fixing was discovered in Canadian bread several years ago, the ramifications for the companies involved was minor.

As for ongoing food price inflation, there’s no credible evidence of collusion so there’s even less likelihood of government action. And what could governments do anyway?

The best advice we can offer consumers is to shop around. The big grocers don’t have a monopoly. Co-op stores have a lot of buying power and may provide better deals on some products. Walmart isn’t yet a big grocery presence in Canada and it may be worth taking some business there.

If you check out dollar stores, you can sometimes buy brand names of staple items at a much lower cost. Just check expiration dates before you buy.

Costco has been a big disrupter. Yes, you need to buy a membership and yes, they sell in quantities too large for many shoppers, but their prices and quality are hard to beat. Unfortunately, for many low-income people, just accessing a Costco is a problem.

It would be great for farmers to have more opportunities to sell directly to consumers. Both could benefit. Buy a quarter or half a beef from a farmer and have it cut to your specifications at a local abattoir. Of course, low-income consumers may not have the money for such a purchase or may not have the freezer space for that much meat.

It’s difficult to save much money when you need to fill your tank with gas. It’s difficult to escape rising costs for rental accommodations or the rising cost of interest on a house mortgage.

For food, there are options on what you buy and where you buy. If you think the big grocers are gouging, don’t give them your business.