Loblaw says grocery price growth to remain elevated in its own inflation report

Loblaw says a confluence of factors including a weak loonie mean grocery prices will continue to rise faster than overall inflation. 

Canada's largest grocer released a report on food inflation the evening before Statistics Canada's scheduled monthly Consumer Price Index report. 

Loblaw says many suppliers are still proposing price increases above inflation, while supply chain issues, a weaker dollar and rising production costs are also making food more expensive.

Canada's major grocers have been under intense scrutiny from politicians and consumers in the wake of a bout of inflation that saw grocery prices go up more than 20 per cent over three years. 

The grocers have denied accusations of profiting from inflation, saying they face unreasonable requests from suppliers and have been doing their part to mitigate rising prices. 

In November, overall inflation declined to 1.9 per cent while grocery prices outpaced the headline number at 2.6 per cent. 

In March 2023, the government brought executives from the major grocers to Parliament Hill to answer questions about how their profits squared with ballooning grocery costs. 

Loblaw's report highlights several commodities that have seen particularly sharp price increases, including coffee and cocoa, which have seen their crops hit by poor weather.

The grocer says the cost of beef has also climbed to all-time highs, while olive oil prices should ease somewhat after recent shortages.

Since Canada imports much of its fresh produce from the U.S., especially during the winter, a weaker loonie makes those products more expensive, Loblaw said in its report. 

"While food inflation has returned to more typical levels, grocery prices are still rising faster than overall inflation — a trend we expect to continue."