So, we completed a rigorous analysis of the most prominent reports that shape the narratives around food prices in Canada, including twelve years of Canada’s Food Price Reports and 39 reports from Statistics Canada. Our findings, which are peer reviewed and soon to be published in Canadian Food Studies, were both insightful and concerning.
Our analysis found that most claims about food prices in these reports lack scientific rigour. Nearly two-thirds of the explanations for price changes given are not backed by evidence. Arguments about the causes of food inflation are frequently incomplete, neglecting to connect the dots between cause and effect.
These reports also rarely consider the decisions that grocers and other private sector entities have on food prices. Increased consolidation and concentration in the grocery sector is a structural issue that deserves scrutiny.
The bread price-fixing scandal a few years ago showed how a lack of competition enables price manipulation and hurts consumers. Canada’s Competition Bureau recently announced they are launching an investigation into the owners of Loblaws and Sobeys for alleged anti-competitive conduct.
With grocer profits expanding in Canada, too, it is fair to ask tough questions about how much grocers’ decisions are contributing to the pain at the till.
In our analysis, only three per cent of the over 200 explanations for food price changes point to grocer actions or other agency in the private sector as driving price increases. This reflects a tendency to portray food prices as erratic and overwhelmingly opaque.
I wish this report could explain how a company like Loblaws can continue to consistently post hundreds of millions of dollars in profit per year, because the report makes it seem like pricing is out of their control.
Not really, if you read the article in full.
In our analysis, only three per cent of the over 200 explanations for food price changes point to grocer actions or other agency in the private sector as driving price increases. This reflects a tendency to portray food prices as erratic and overwhelmingly opaque.
Other issues — such as the over-reliance on fossil fuels across the supply chain — also go unmentioned.
It’s really shitty wording, but they’re basically saying “of the 200 proposed causes, only 3% of those proposed are about grocer decisions” rather than “grocer decisions make up 3% of the cause in rising costs”.
In the rest of the article announcing the report (it isn’t released yet), they pretty clearly call out anticompetitive behaviors and price fixing:
These reports also rarely consider the decisions that grocers and other private sector entities have on food prices. Increased consolidation and concentration in the grocery sector is a structural issue that deserves scrutiny.
The bread price-fixing scandal a few years ago showed how a lack of competition enables price manipulation and hurts consumers. Canada’s Competition Bureau recently announced they are launching an investigation into the owners of Loblaws and Sobeys for alleged anti-competitive conduct.
In the United States, there is also strong evidence that the private sector has been profiteering on supply chain issues and inflation. The U.S. Federal Trade Commission likewise recently found that big grocers used the pandemic as a smokescreen to pad their profits at the public’s expense.
The underlying thesis of the article is basically “people keep asking why food is expensive but all these reports are unscientific and all but 3% of them neglect things like price fixing and monopolies”.
What we need is a new approach. Food is a human right, but a unique one in that we rely on the private sector to provision it. We should expect a higher standard than with other consumer goods, and the private sector has arguably not earned the benefit of the doubt given their history of price fixing.
One positive step towards generating trustworthy evidence about food prices would be to incorporate transparency measures into the code of conduct the Canadian government is developing with grocers. This could include third-party audits, open data-sharing and a clear breakdown of what’s driving price changes — from the farm to the shelf.
The article authors (and report authors) are very based.
I have nothing to add per se, but I just thought I’d thank you for writing such a well thought out, informative comment and sourcing it so well.
I wish I could take credit, but those quotes are all directly from the linked article! I felt the comment I was replying to was incorrect about the content of the article and wanted to clarify. Truly they did write a good piece worthy of recognition, though.
My favourite was a report that showed a percentage increase in profit that was higher than the percentage increase in revenue. Is that not the very definition of “higher margin?”
I only read the abridged version, but it seems like it does to me. It basically said that the reports are purposely burying the lead and FOR SOME REASON refuse to entertain the idea that it’s caused by corporate greed.
This report isn’t about grocer finances. It’s about the analysis of food prices, and basically it says that a lot of the info that people are fed through the media and that is used to inform policy-making is not evidence-backed and doesn’t stand up to scrutiny.
Their point is that if we want to ensure food is affordable, etc., we need real data and not the bogus reports that are currently out there. The first step in getting real data are calling out current reports as bogus.
These reports are not scientific publications, but rather qualify as “grey literature” — information produced outside traditional academic publishing channels.
Nevertheless, they are published under the logos of academic institutions and government agencies. Given their prominence in Canadian media and policy, we believe it is important for the public to know that the arguments presented in these reports do not live up to scientific standards.
Can you say, merger and consolidation leading to monopoly practices in a text book example of how not to regulate and oversee a free market? I knew you could.
