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Prime Minister Mark Carney unveiled a new food security strategy on Thursday that commits to spend $3.2 billion over a decade to produce more food in Canada and make it more affordable.
While grocery rebates now hitting low- and middle-income bank accounts offer some short-term relief, this new strategy attempts to fix some of the root causes behind the spike in food prices.
“That reliance on foreign markets means that every global shock — foreign conflict, drought and tariffs — shows up directly at grocery stores across this country,” Carney said.
“We are going to grow more at home, process more at home and feed more Canadians with Canadian food.”
Carney announced the new measures at the Ontario Food Terminal in Toronto — which distributes nearly two billion pounds of fruits and vegetables annually across Canada.
The first-of-its-kind federal strategy commits to investing $1 billion to create more choice and competition. The money will go into the new Food Link Fund to support wholesale marketplaces, known as food terminals and food hubs.
Prime Minister Mark Carney announced a new $3-billion national food security strategy to combat issues in the Canadian food system in Toronto on Thursday.
These terminals allow independent grocers to buy food at competitive prices, bypassing supply chains owned by the large retailers. They also sell fresh produce directly to hospitals, restaurants and consumers.
Currently small grocers often buy from their vastly larger competitors — sometimes paying the same prices that families pay.
“That’s why when you go to the corner store you often are paying a higher price,” Carney said.
The strategy sets targets — like expanding the Ontario Food Terminal by the end of the year and opening two new food terminals and establishing or expanding 10 smaller food hubs by the end of 2028.
A senior official in a briefing with reporters said, however, that the strategy does not set a target price for a basket of goods nor define what affordable food actually is.
Carney also said Ottawa will “crack down” on surveillance pricing, where companies use data such as online browsing history to change prices for individual shoppers.
The federal NDP has been calling for a ban on the practice and other measures to protect consumer data. Carney said the government would “ideally” table legislation to update federal privacy laws before the end of June.
New Democrats are also calling for further public interventions to drive down food prices like price controls. NDP Leader Avi Lewis has called for the federal government to operate public grocery stores — a chain of government-owned Costco-like centres — that ensure access to affordable food.
In a statement, Conservative Deputy Leader Melissa Lantsman said Liberals can reduce food prices by cutting taxes and spending.
“Liberal hidden taxes, including the industrial carbon tax and inflationary spending, drive up the cost of growing, transporting, and buying food, while the weak dollar makes imports pricier,” Lantsman said.
Promoting food sovereignty
Canada depends on food imports — with 88 per cent of fresh fruits and nuts and 72 per cent of vegetables coming from abroad. Although Canada is the ninth-largest exporter of agri-food products, it is also the 11th-largest importer.
Half of Canada’s food imports come from the United States.
Why are grocery prices so high? One factor may be property controls — a powerful tool that big groceries can use to block competition and control local markets across Canada. Marketplace breaks down how it works and why it can take a toll on your wallet.
“A country that can’t feed itself, fuel itself or defend itself has few options,” Carney said in his speech to the World Economic Forum in Davos, Switzerland — a few days before announcing this strategy was forthcoming.
Since then, officials have been scrambling to get a strategy in place to make sure a country as rich in agricultural land as Canada never experiences security threats in the form of food shortages.
But at the individual household level, food insecurity is more likely caused by the inability to afford the higher grocery prices that have persisted since the COVID-19 pandemic, owing to a range of factors this strategy aims to address.
One of them is a lack of competition. The strategy notes that five big supermarket chains — Loblaw, Metro, Empire (Sobeys), Walmart and Costco — dominate 75 per cent of the market. Independent grocers, convenience stores and regional chains, like Pattison Food Group in Western Canada, account for the rest.
Justin Trudeau’s government attempted to disrupt the monopoly behaviour of Canada’s giant grocery retailers, but was unsuccessful at attracting new competition.
This strategy boosts funding for the federal Competition Bureau and the Competition Tribunal, in an attempt to more closely monitor and enforce competition in food retailing and across its supply chains. Altogether funding for these bodies will rise by $12.9 million annually.
The federal government has started rolling out a new grocery and essentials benefits as it manages the ramifications of a technical recession and the looming review of the Canada-U.S.-Mexico Agreement.
Small- and medium-sized food processors can now also receive support to modernize and increase food productivity through a fund under the Crown corporation Farm Credit Canada, considered the nation’s largest agricultural lender.
The strategy also sets aside $700 million over seven years so greenhouses and other indoor food production can adopt new technology and reduce energy and operating costs. From that funding envelope, rural and northern communities will receive $100 million.
“This funding will improve access to fruit and vegetables year round … and reduce price swings caused by global disruptions,” one federal official told reporters.
The strategy also seeks to address the need for new climate change mitigation strategies to ensure Canadian agriculture remains resilient.
Source: cbc
