A man leaves a Loblaws store in Toronto, on May 3, 2018.Nathan Denette/The Canadian Press
Canada’s largest grocer is freezing prices on its private label food products for the next three months amid record-high inflation.
Loblaw Cos. Ltd. announced on Monday that effective this week, it will hold firm prices on all No Name brand food products until the end of January, 2023. The price freeze will apply to more than 1,500 products.
“Anyone who regularly visits the grocery store knows that over the past year, the cost of food has increased rapidly,” Loblaws president Galen Weston said in an e-mail to customers on Monday.
“Maddeningly, much of this is out of our control.” In a news release, the company blamed “increased suppliers’ costs due to fuel, labour, weather and global conflict,” which has been passed to retailers.”
Grocery prices have increased over the past year at the fastest rate in decades. Prices in grocery stores were 10.8 per cent higher in August of this year, compared with last year – the fastest rate of food inflation since 1981.
Still, overall inflation has cooled in recent months, largely as a result of falling gas prices. As such, most experts had predicted food inflation to also cool in the coming months.
“I think they’re at least a month late,” said Sylvain Charlebois, director of the Agri-Food Analytics Lab at Dalhousie University.
Rising food prices has led to negative attention for all of the major grocers, including Loblaws, with politicians and commenters on social media alike accusing the retailers of price-gouging.
“I think grocers needed to do something. This is an important PR move for not only Loblaws, but the sector,” said Prof. Charlebois. He also pointed to the timing of the Loblaws announcement.
Later this week, Statistics Canada is expected to release the inflation figures for September. This, said Prof. Charlebois, will likely report another rise in food inflation.
“Again, the food inflation rate will be very high, and Metro and Sobeys will have to field hard questions about food prices. And Loblaws will have an answer.”
Still, the Loblaws news comes ahead of the holiday season - one of the busiest times of the year for grocers. And for grocery customers who have spent the past year struggling to make ends meet, the news will undoubtedly come as relief.
“You’re basically seeing the largest grocer in the country offering a safe place for struggling families to go,” said Prof. Charlebois. “It was something that was important to do.”