TORONTO — Canadian families could face another round of grocery price increases this fall as record-high diesel costs raise the expense of transporting and producing food across the country.
Diesel prices have reportedly climbed above $2.50 per litre in parts of Canada, with energy analyst Dan McTeague saying recent levels have surpassed previous records. Because diesel powers trucks, farm machinery and much of the transportation network, higher fuel costs can eventually work their way into prices throughout the supply chain.
Sylvain Charlebois of Dalhousie University’s Agri-Food Analytics Lab estimates sustained diesel prices at current elevated levels could add at least half a percentage point to food inflation. The impact could become more noticeable during fall and winter, when Canada relies more heavily on transporting fresh produce and other food over long distances.
Consumers could see pressure across several grocery categories, including fresh fruits and vegetables, meat, frozen products and packaged foods. Statistics Canada data cited in the report show grocery prices are already about 29 per cent higher than in August 2021.
Global energy disruptions are adding to the concern. Reduced oil and fuel supplies linked to conflicts affecting Russia and the Middle East have tightened international markets, while a weaker Canadian dollar can increase the domestic cost of globally priced commodities.
Food prices could face additional pressure from weather-related crop problems and rising commodity prices. Charlebois pointed to substantial increases in wheat and rice prices and warned that an extended commodity price cycle, combined with El Niño-related weather disruptions and tariffs, could keep food inflation elevated into 2027.
Consumers are not being advised to panic-buy. However, Charlebois suggested households may want to take advantage of sales and stock up reasonably on non-perishable products they regularly use while prices remain favourable.