The Big Story Why the sky high price of groceries may be starting to stabilize
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May 2, 2025 Stuart Smyth, a professor in Agricultural and Resource Economics at the University of Saskatchewan, dives into the factors affecting grocery prices in Canada. He discusses how the depreciation of the Canadian dollar and U.S. trade policies have driven food inflation. Seasonal availability of produce could stabilize prices this summer, though challenges like tariffs and avian flu impact specific sectors. Smyth also questions outdated interprovincial trade barriers and their relevance to modern agricultural markets.
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Canadian Dollar's Impact on Food Prices
- The low Canadian dollar and tariff uncertainties caused the March food price increase.
- Import contracts priced in US dollars immediately raised Canadian food costs.
Food Prices Expected to Stabilize
- Food prices may plateau through early summer due to tariff delays and a stronger Canadian dollar.
- Carbon tax removal on food transport temporarily eases inflationary pressures.
Early Canadian Produce Eases Inflation
- No major upward price pressures are apparent this spring in Canada.
- Early Canadian produce like berries arriving mid-June should ease food inflation.