The highly consolidated supermarket sector will be the subject of a probe by Canada’s competition commissioner to see whether it is a factor in rising food prices.
The Competition Bureau stated in a news release on Monday that Canadian consumers have suffered a loss in their purchasing power due to rising inflation.
“This is particularly valid while purchasing groceries. In fact, grocery prices in Canada are increasing at the fastest rate seen in 40 years.
With prices up 11.4% from a year earlier, grocery prices grew at the quickest rate since 1981 in September. This contrasted with a 6.9% total inflation rate.
The price of food has not only increased faster than the overall inflation rate—which has started to decline from its peak of 8.1% in June—but also continues to rise.
The Competition Bureau said Monday its study will examine to what extent higher grocery prices are related to changing competitive dynamics in the sector.
It plans to examine potential government interventions to reduce supermarket price hikes through increased industry competitiveness.
It was mentioned that there is a lot of concentration in the supermarket market, with most Canadians purchasing from one of three firms: Loblaw, Metro, or the parent corporation of Sobeys, Empire Co. Ltd.
According to it, competitiveness levels differ across the nation.
The Competition Bureau intends to release its final report in June and will include a set of recommendations for the government.
The House of Commons Agriculture Committee decided to look into food costs earlier this month.
The House of Commons also voted unanimously in favour of an NDP motion calling on the government to tackle “corporate greed” in the grocery sector..
The Canadian Competition Bureau will look into soaring grocery prices
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