Greedflation? Grocery retailers in Canada insist they do not know what officials are talking about. The term greedflation is in reference to businesses capitalizing during this time of inflation to maximize profits.
CEOs and presidents of Loblaw Cos. Ltd., Metro Inc. and Empire Co. Ltd., which run chains including Sobeys, Safeway and FreshCo, faced members of the Canadian Parliament in an effort to clarify the continued high price of groceries, or greedflation. The executives dismissed the notion that the grocers themselves are behind prices that have skyrocketed over the last year. The general consensus was food inflation is a global problem, and a few of the officials were wondering why American companies which do business in Canada were not called on for questioning.
Galen Weston, chairman and president of Loblaw, backed his stance with data: food prices have increased 25 times faster than profit margins on food products. Weston said Loblaw has made more money off financial services, apparel and pharmacy sales.
The New Democratic Party pushed for the meeting with the grocery officials about greedflation, with NDP leader Jagmeet Singh making a social meeting spectacle out of the event.
Grocery prices in January were up 11.4% vs. January 2022, which is nearly double the rate of inflation (5.9%) in Canada.
Still, grocery and food manufacturers continue to post high profits. Prices for agricultural commodities are down, and the cost of ingredients also has lowered. However, grocery officials blame transportation, higher wages and packaging behind the increase in food prices.
Some are even saying the price before the pandemic was too low. At a conference last month, Conagra, which makes Marie Callender’s, Birds Eye and Healthy Choice frozen pizzas and bowls, said the consumers have accepted a $4.50 unit cost because it is still a good value. Conagra also said charging more has led the company to include better ingredients.
