Each day TFO Canada publishes a sample of trade news on the Canadian import market along with any new, updated or changed regulations and legislations regarding international trade; countries in which TFO Canada offers services and on the export sectors which it promotes.
Canadian loonie hits 13-year low, causing imported veg prices to soarThursday, January 21, 2016 > 09:49:55
The Canadian dollar hit a 13-year low Friday and some prominent Canadian economists are warning that a potential rate cut by the Bank of Canada this week could risk undermining confidence in the Canadian dollar. Never before has the loonie fallen so far, so fast, against the U.S. dollar as over the past two years and although there are benefits to households, most notably through lower energy prices, the rising costs of imports are also passed through to consumers, who are finding some fruits and vegetables far more expensive these days.
A new report from the University of Guelph’s Food Institute predicts consumers will pay an additional $345 on their food bill this year.
The report’s lead author, marketing and consumer studies professor, Sylvian Charlebois, cited Canada’s struggling dollar as the biggest influence on prices. The cost of foods such as fruits, vegetables and nuts jumped by as much as nine to 10 per cent last year and it is expected that retail prices for these foods could go up by as much as 4.5 per cent again this year if the Canadian dollar continues to decline as expected.
The soaring price of cauliflower is also forcing restaurants with signature dishes featuring the popular vegetable to rethink their menus and hike prices.
Over the past few years, cauliflower has been springing up on menus in innovative ways. However, the sliding loonie and a drought in California have helped drive prices for the snowy white vegetable toward double digits a head, causing a cauliflower crisis.
At least one restaurant chain famous for its take on cauliflower is passing on some of the extra costs to its customers. The restaurant now pays more than double what it used to for a case of the cruciferous vegetable, up to $60 a case.
Squash may be the next go-to ingredient for chefs looking for a new heir to cauliflower's popularity since many other vegetables, not just cauliflower, are steadily increasing in price. Celery, cucumber, tomatoes are all slowly taking themselves out of the running.
Yet there is good news for local produce retailers who have seen a boost in sales with the low loonie. Some P.E.I. vegetable sellers are selling more product this winter, and expect bigger profits come spring.
Brookfield Gardens and Red Soil Organics sell to Sobeys and the Atlantic Superstore. Owner Matt Dykerman said business is usually slow this time of year, but root vegetables have been flying off the shelves.
He suspects it's because customers don't want to pay the high prices for other vegetables like broccoli and cauliflower.
"Obviously it's good news for our business, I think it's a good thing that people are looking at buying more local product, I think that's good for the local economy."