Canadian consumers will have to pay more for food next year, according to the 2016 Food Price Report from University of Guelph researchers.
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After a year in which a lagging Canadian dollar led to substantial price jumps for many products, shoppers will face smaller increases in 2016, especially for meats, fruits and nuts, and vegetables.
Overall, the researchers expect prices increases averaging two to four percent, above the general rate of inflation.
The struggling Canadian currency, climate factors and consumer trends will all play important roles in 2016, said Prof. Sylvain Charlebois, lead author of the sixth annual report from the Food Institute of the University of Guelph.
“This means the average household will likely spend $345 more than in 2015 for the same exact food,” said Charlebois, of the Marketing & Consumer Studies department.
“The biggest factor could be the Canadian dollar. For every cent the dollar drops, foods that are imported likely increase one percent or more. For fruits and vegetables, unlike with meats, it’s more challenging to find substitutes in Canada, so shoppers will have to cope with higher prices.”
In 2015, the sudden currency drop led to fruits, vegetables and nuts increasing in price by nine to 10 percent. The researchers anticipate that those prices could increase in 2016 by up to 4.5 percent.
One potential improvement is more rain forecast for the United States in 2016 due to the effects of El Nino.
“This could mean more supply from those states where farmers had struggled in recent years. It could also help U.S. cattle and pork producers, though inventories will take some time to rebuild.”
Meat prices, which rose five percent in 2015, could rise by 4.5 percent in 2016. ■
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