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Going to the grocery store may be a little disheartening for people wanting stock up on fresh fruits and vegetables as prices seem to be sky rocketing.
John Janmaat, an associate professor of economics at UBCO, said the exchange rate has had a huge effect on rising produce prices in Canada. The majority of fresh food we buy this time of year is imported, most from the U.S.
“Our dollar has fallen so much over the last couple of years,” said Janmaat. “If our dollar goes down, relative to the U.S., everything we buy that is priced in U.S. dollars is going to be more expensive.
“Pretty much anything that comes in from the U.S. is going to be showing some price increase, and that would apply to most fresh produce that we get.”
Also to blame, is the drought in California.
“The supply is going to go down and as our currency goes down, they will inevitably lead to a price increase,” Janmaat explained.
Janmaat also said the rising popularity of cauliflower as a health food, may be the reason why some are priced higher than $10.
“That further increases the demand, which, given the tight supply is going to drive the price up even more,” he said.
Things that are grown and produced in Canada, like grain and beef, aren’t going up in price as much.
Janmaat said the high prices probably won’t stick around for the long run.
“I would expect that Canadian producers are going to see the higher prices as an opportunity to make money,” he said, explaining that Canadians will likely try and sell products at a higher price, expanding supply, and causing prices to go down.
“Particularly come the summer, of course, when we can grow a lot of it here.”
Even though prices are so unusual, Janmaat said it won’t affect customer shopping patterns too much. Everyone needs food, so they won’t reduce the amount they buy very much.
“Food is a very sensitive topic when prices go up because it’s very hard for us to say, ‘Well, I’m not going to buy that for the next week or the next month,” said Janmaat.
Some options include shopping around, to find items at a lower price, and switching to squashes and root vegetables that are more abundant and therefore lower priced.
Trends in food prices have seen ups and downs in prices overtime, according to Janmaat. Recently, beef prices were high because beef herds shrunk, and producers couldn’t keep up with demand.
“These types of trends are not unusual, it’s just particularly striking now that our dollar fell so fast, and we import so much from the U.S. this time of year, that we really see it at the grocery store,” said Janmaat.
On Wednesday, Statistics Canada released information on fruit and vegetable prices in the country. From 2014 to 2015, the farm-gate value of Canadian fruits and vegetables rose 3.9 percent to $1.9 billion.
This is the first time vegetables have reached the $1 billion mark, up 8.8 per cent alone. Vegetable exports also increased across the board, in prices and sheer quantity.
According to StatsCan, the weaker Canadian dollar could have led to people in the U.S. buying more Canadian food.
Apple yields fell over 15 per cent nationally, and their total value fell by more than 14 per cent, to $182 million.
Blueberries are the largest fruit commodity and accounted for almost 30 per cent of the value of all fruits in 2015.
In British Columbia, high bush blueberry production increased 6.3 per cent to 70,000 tonnes and producers received higher prices than the rest of the country.
The value of grapes increased almost 5 per cent to $121 million, because of higher prices. Ontario had the largest share of the total grape value, followed by B.C.
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