Calgarians grapple with high food prices even as overall inflation rate slows

Food prices continue to take a big bite out of household budgets, even as the overall cost of living goes down in Alberta and across the country.

Hilary Martin, who has two young sons, says discount days at the grocery store are crucial.

"Days like today at Save-On, where they have the $1.49, are really important even in this weather, to get out and buy what you can on sale because one grocery stop is $100 easy," she said.

According to Statistics Canada's latest inflation report, food prices went up 11.4 per cent in January, compared to a year ago.

Lettuce alone has gone up 35.3 per cent since last year. Meanwhile, fresh vegetables as a whole went up 14.7 per cent.

From December to January, the price of fresh or frozen chicken increased faster than almost every other grocery item at nine per cent.

Sylvain Charlebois, director of the Agri-Food Analytics Lab at Dalhousie University, says the avian flu, which killed millions of birds on poultry farms in Canada and the U.S., is to blame.

"The avian flu was a big factor out west, impacting egg prices and poultry prices, so we weren't surprised to see higher prices for those two categories specifically," he said.

Charlebois says supply chain disruptions, the war in Ukraine, the cost of fuel and climate change are also driving prices up.

"Our food inflation rate now is higher than the U.S. and Russia," he said.

Charlebois warns things could get worse before they get better.

He cites a significant increase in the cost of dairy and dry foods that we won't see the impact of until Statistics Canada releases its next inflation report in March.

Some Calgarians are changing how they grocery shop due to the high prices.

"We're not getting the quality that we used to get. We're having to go for the less expensive items," said Calgary resident Kerry Smith.

His wife Vicki added, "Often, a lot of the food too is in smaller packages, except higher prices and smaller packages."

Charlebois expects the food inflation rate will start to drop in April or May.

"Supply chains are going to be normalized. Hopefully, the Ukrainian situation won't be as much of a factor and we'll be able to rely on a sound grain deal between Turkiye and Russia, which is not the case right now," he said.

While food prices remain high, Canada's annual inflation rate slowed to 5.9 per cent in January from 6.3 per cent in December.

The last time Canada's inflation rate was below six per cent was in February 2022 when it was 5.7 per cent.

"It's good news but it's still going to be a slow march back to that two per cent target from where we are today," said Rob Roach, deputy chief economist with ATB Financial in Calgary.

Alberta's rate dropped the most out of all the provinces to five per cent.

Calgary's inflation rate is a bit higher at 5.5 per cent.

"When you put it all together, the cost of living and inflation tends to be a little bit higher in urban areas versus the province as a whole," Roach said.

Trevor Tombe, an economics professor at the University of Calgary, did a further breakdown of the numbers in Alberta on Twitter.

In Alberta, inflation has eased more than elsewhere. Over the past six months it has been ~0%. Over the past three, prices have fallen. Energy is a big factor, including policy changes (gas tax cut, bill rebates). pic.twitter.com/xFQbRWcXoD

— Trevor Tombe (@trevortombe) February 21, 2023

He says energy and gas prices have dropped the most, and attributes it, at least in part, to the province's electricity rebates and gas tax cut.

Meanwhile, Martin says even with the overall inflation rate dropping, she will continue to save when and where she can.

"I will always go where the best bargain is," she said.

"In the grand scheme of things, I'm fairly fortunate, but I do know people who are struggling worse."