Drought among factors influencing rising food costs

By KENDALL KING, Local Journalism Initiative Reporter on September 23, 2021.

Many Albertans have noticed an increase in the cost of food since the beginning of the year.

Canada’s Food Price Report for 2021 predicted food prices would rise 3-5% by year’s end, with meats and vegetables seeing the largest increase. These increases can be attributed to a variety of factors, that often vary depending on the type of industry.

Perry Deering, co-owner of Deerview Meats, told the News that the meat industry is currently feeling strain due to this year’s drought, which caused widespread feed shortages.

“Feed shortages have led to more cattle being forced into the processing market,” Deering explained. “Producers have gone into survival mode (as) they can’t afford to raise (the cattle).”

The influx of cattle into the processing market does not necessarily mean prices will drop, as many large companies use disruptions in the market to invest in their business, costs that consumers ultimately end up shouldering.

“(The industry) is controlled by the big companies,” Deering said. “That’s why competition is so healthy; as it allows for fair marketing.”

Buying local can, at times, be more cost effective than buying from large companies, but local producers are not immune to price increases.

“(The cost of food) is directly related to the cost that the producer has to incur to put that product onto the shelves,” said Jonathan Schow, vice president of sales and prices at Big Marble Farms.

Costs of electricity, packaging, labour and freight all may factor into the final price.

Annual inflation and supply and demand dynamics also play a role in determining prices. When the pandemic began the demand for food changed drastically and many producers were unable to immediately meet that demand, which resulted in prices rising.

“It’s all intertwined,” said Schow. “As demand increases locally, the supply will respond.”

With rising prices in stores, both Deering and Schow encourage consumers to consider local options.

“We have a great supply network here and the more that it’s supported the stronger it can become,” said Schow.

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