No immediate relief in sight for British Columbians as inflation rate skyrockets, experts say
Official inflation rate rising at a 6.8% annual pace, a 31-year-high; spike in food bank usage observed
Quick relief for spiking food prices likely isn't in the cards for British Columbians, experts say, as inflation reaches new heights in Canada.
The cost of living continues to rise at the fastest pace in decades in the country, with the official inflation rate rising at a 6.8 per cent annual pace in April, a new 31-year high.
For B.C. specifically, the rate of increase was slightly lower at 6.7 per cent.
Food prices nationally have also risen by 9.7 per cent in the past year according to Statistics Canada — the largest increase in a one-year period since September 1981.
"It's not really demand pushing the prices up for food. It really is a supply chain story," said James Vercammen, a food and resource economics professor at the University of British Columbia.
He says the largest issue is that inflationary pressures are being felt at every step of the food production process.
Janet Music with the agri-food analytics lab at Dalhousie University adds that the Russia-Ukraine war has a part to play in the crisis.
She points to the price of wheat as an example, with Ukraine being one of the world's largest producers of the grain.
"You're seeing an increase in [the price of] pasta and breads and flour over the last six months, and that can be attributed to that," she said.
Vercammen and Music also say the COVID-19 pandemic had led many employees to exit the labour market, creating disruption to the supply chain.
Both experts say they see a grim future without regulatory action.
"If your income is connected to the overall cost of living, food is becoming increasingly expensive and it does make a difference year after year," Vercammen said.
"When you look over a two- or three-year horizon, it's not hard to get to 20 per cent higher food costs."
Spike in food bank use
The rising costs of living are leading more Vancouverites to use food banks, according to Cynthia Boulter, COO of the Greater Vancouver Food Bank (GVFB).
"We've seen 800 to 900 new clients sign up for support with us each month," she said. "That's easily double what we were seeing last year. It's quite alarming, honestly."
She says more people, from all walks of life — including seniors, families and international students — are coming to food banks in the Lower Mainland, with the GVFB's Vancouver branch getting a lot of traffic in particular.
"If this gets a whole lot bigger, we are going to need some more space to process more food," she said.
"But we've been fortunate through the pandemic. People have thought about food banks and really supported us."
No immediate relief in sight
Vercammen and Music say the impact of the crisis is being felt unevenly.
Vercammen notes that communities in the north, in particular, are affected more than people who live close to the border — as supply chains become more strained, with imports factored in.
Music says Canada's food security is dependent on its global trading partners, with the country being a price taker and not a price setter.
This means global inflationary pressures, which are increasing daily, will impact the country disproportionately.
Looking to the next few months, however, Music and Vercammen both say the growing season might bring some relief for vegetable and fruit producers, particularly if they are based locally.
Vercammen adds that meat producers — whose product has soared the highest in terms of price — are also bringing more supply to the market, which could eventually bring prices down.
But ultimately, he says the general rate of inflation worldwide has a huge part to play in the crisis.
"We know the Bank of Canada and other central banks around the world are going to have to raise interest rates to deal with this," Vercammen said.
With files from Steve Zhang and Joel Ballard