Canadian food retail sales on a downward trajectory

Canadians buying less food

The release of retail data by Statistics Canada last week has provided valuable insights into the dynamic nature of food retailing in Canada.

Contrary to initial assumptions, the data reveals intriguing fluctuations in Canadian food and beverage retail sales per capita since 2017, challenging prevailing expectations and necessitating a closer examination of the underlying factors at play.

The figures indicate that in March 2017, sales per capita stood at $258.41, experiencing a marginal decline to $257.05 in March 2018 and a further decrease to $256.61 in March 2019. However, a notable shift occurred in March 2020, with sales per capita surging to $309.19.

This significant increase can be attributed to the emergence of the COVID-19 pandemic and associated lockdown measures, which led to changes in consumer behaviour and a reversal of the preceding downward trend in food retail sales.

Post-2020, the data shows a resumption of the downward trajectory in food retail sales. In March 2021, sales per capita dropped to $277.03, indicating a decline from the previous year. This decline can be attributed to the lingering impact of the pandemic, which disrupted various industries, including the retail sector.

Furthermore, in March 2022, sales per capita experienced a further decrease to $257.55, signifying a continuation of the downward trend. The most recent available data from March 2023 reveals a further decline to $237.20, marking the lowest point in recent history. These figures suggest that Canadians are spending less on food at grocery stores, despite facing higher food prices.

But here is another piece of valuable data. Recent NIQ data indicates a two per cent decline in food sales by volume in Canada in the last year, further emphasizing the reduction in food expenditures among Canadians.

This trend raises several considerations. One possibility is Canadians are increasingly relying on alternative food sources, such as ordering meals from restaurants or using unconventional channels to fulfil their food needs. However, given recent menu prices, this explanation seems unlikely.

Another possibility is individuals are opting for lower-cost alternatives and seeking out independent stores that cater specifically to the needs and preferences of immigrant communities. Private labels or store brands are and will increasingly become more popular. This observation suggests a potential increase in the number of food businesses serving these communities compared to previous periods, indicating a shift away from mainstream food sources.

The data also suggests Canadians may be wasting less food, particularly with the rise in remote work arrangements. The consumption of leftovers and repurposing of food could be contributing to reduced food waste, although this is purely speculative. The occurrence of “shrinkflation,” whereby product sizes are reduced without a corresponding decrease in prices, may also play a role in reducing waste. However, the impact of these factors on the overall decline in food retail sales requires further investigation.

Another possibility of concern raised by the data is that Canadians may be consuming less food or relying on food banks more frequently. Reports of long lines at food banks and increased usage across the country indicate a potential rise in food insecurity.

While it is unlikely increased gardening activities alone could explain such a significant shift in the data, the underlying reasons for the increased reliance on food banks are troubling nonetheless.

The bottom line is, if people think grocers are riding the inflation wave with their food sales, they should think again. It’s just not happening.

Loblaw, for example, saw its food sales go up 3.1 per cent in the first quarter, which is significantly below our food inflation rate. Grocers are treading water with food sales, at best. Record profits are being recorded, but it’s not because of food sales.

Canadians are buying less food, and, chances are, that trend is likely to continue for a while. Just like in the early 1980s, consumers are programmed to seek deals all the time. This is what the market is doing to all of us right now.

We are all becoming better bargain hunters, for those of us lucky enough to afford the food we need to eat.

Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Gene editing approval crucial step to global food security

Helping secure food supply

The environmental approval of gene editing by Marie-Claude Bibeau, the Minister of Agriculture and Agri-Food, went largely unnoticed by the mainstream media last week.

It’s understandable considering the plethora of news that captured the public’s attention, from the ongoing issue of Chinese interference to King Charles’ coronation.

Gene editing may not be the most captivating subject to engage consumers, but its significance for global food security cannot be overstated. Fortunately, Ottawa is getting it right.

Last week, Bibeau made an important announcement regarding the Canadian Food Inspection Agency’s implementation of Part 5 of the Seed Regulations. This aligns with Health Canada’s decision less than a year ago that classified gene editing as “non-novel” while subjecting it to appropriate regulations. This is a crucial leap forward for global food security.

The next and final step involves consulting and assessing the gene editing of plants intended for livestock feed. Legalizing gene editing in Canada could be granted as early as this fall.

In simple terms, gene editing in food refers to the use of techniques such as CRISPR to modify the DNA of plants, animals, or microorganisms used in food production. Unlike GMOs, which involve inserting genetic material from different species into an organism’s genome, gene editing allows scientists to make specific changes to an organism’s genome, potentially enhancing its nutritional value, disease resistance, or other desirable traits. It holds the potential to create crops that are more resilient to pests, diseases, and environmental stresses, while also improving their flavour, appearance, and shelf life.

Gene editing will undoubtedly aid agriculture in tackling climate change and adapting to ever-changing growing conditions. It will also streamline the research and development process, potentially saving millions in research costs, and making scientific advancements more adaptable to our evolving environmental and ecological landscape. Increasing yields can reduce the risk of severe price fluctuations, benefiting both ends of the food continuum, including consumers at the grocery store.

However, it is crucial to prioritize clear labelling. Consumers should have the right to know what they are consuming and understand the technologies that impact farmers’ crops worldwide, including in Canada. Canada’s global leadership in genetic engineering should be celebrated, even if it remains largely unknown to the average consumer. Demystifying the virtues of genetic engineering for consumers is critical to equipping agriculture and farmers to face climate change more effectively. It also has the potential to make certain food categories more affordable, such as non-gluten wheat, benefiting individuals with allergies or specific intolerances.

Groups opposed to gene editing have consistently misled the public through fearmongering, falsely claiming that gene editing lacks oversight. They have once again criticized the government’s decision, accusing it of promoting unnatural agriculture. However, nothing could be further from the truth. These groups often exploit the public’s limited understanding of the technology.

To be clear, Ottawa has declared its commitment to establishing monitoring and oversight measures, to guarantee the precision and dependability of the publicly accessible database, based on the recommendations of a government-appointed steering committee. These strict guidelines will hold the industry accountable and ensure transparency.

While science has thus far indicated minimal risks associated with gene editing for humans and the environment, the debate surrounding its safety and ethical implications in food continues. Given the variation in regulatory frameworks across countries, this discussion must persist. Science is not absolute, so monitoring longitudinal risks will be critical. Anti-genetic engineering groups have the right to express concerns, but they should refrain from exaggeration, as they have done in recent decades, bordering on the ridiculous.

But for now, we can safely say Ottawa and Minister Bibeau did the right thing and deserve all the credit. Even if most may not fully appreciate technological advancements in agri-food, consumers should be thankful for them.

Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Remote workers, be careful what you wish for

Downside of remote work

The pandemic forced the world to learn how to work together in isolation.

As we emerge from the fog of viral war, many employees are left with memories of laptops on laps, sleeping in, sporadic work schedules and zero commutes. Indeed, the quality of life for many employees during the pandemic grew to an all-time high.

It’s not surprising that many employees would like to continue to work remotely.

The pendulum, however, continues to swing and remote workers based in B.C. should be very careful about what they wish for. Remote work eliminates the local economy. Companies that successfully embrace remote workforces are already realizing that they can employ workers in foreign countries at discounted rates.

Employers also have gained access to employees working in diverse time zones, enabling their workday productivity to grow from local hours to around-the-clock.

Lower competitive wages and triple the available work hours is a compelling incentive for B.C. companies to diversify their remote workforce across time zones and economies.

The fact is, the only borders remaining in our global economy are language borders.

One has to wonder why a B.C.-based company would continue to employ local remote workers at premium local rates. Over the long term, they won’t.

It’s not all doom and gloom, however, for local remote workers. Many have started to realize that they can apply for remote work in countries, like the U.S., with higher comparative salaries coupled with currency premiums. The time zones are similar and when one adds the currency exchange on top of U.S. pay rates, local remote workers can earn a premium above local employers.

Living in Vancouver, while working for a techno-giant in Silicon Valley, would be a dream gig for any local professional. In the future, the challenge is that those roles can also be filled by Second and Third World workers in their local economies. Why hire a British Columbian remote worker when an Indian professional with a legitimate MBA is available to work through the local night at 50 per cent of the cost?

The next 10 years will see the pendulum continue to swing, and if capitalism remains true to form, the wage disparity between remote workers around the world will flatten.

First World remote workers will choose to accept lower pay in return for the luxury of working from home and remote workers from less advanced economies will see pay raises supporting newfound economic growth in their local markets. Globalization will lift millions of people’s quality of life while at the same time pressure our local remote workers in B.C. to find new ways to create value from the comfort of their homes.

Don’t think for a second that this is only a remote possibility.

Neil Belenkie is the CEO of Ascent Drywall and Coatings, a serial entrepreneur, and former mayor of Belcarra.

This column first appeared in Business In Vancouver.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Poll finds dissatisfaction with local action on homelessness in B.C.

Dealing with homelessness

It is safe to say that British Columbians remain dissatisfied with the way in which elected officials – including B.C.'s new premier and new municipal councils – have managed the issue of homelessness.

Just over one in five residents of the province (21 per cent) believe the federal government has done a “very good” or “good” job coming up with solutions to deal with homelessness.

This is up one point since August 2022, when Research Co. and Glacier Media last examined this issue.

The stagnant rating for Ottawa is terrible news for the governing Liberal Party, which pledged to reduce “chronic homelessness” by 50 per cent by 2028. In November, Auditor General Karen Hogan pointed out that the federal government does not know if its initiatives are working. Most British Columbians appear to share Hogan’s point of view.

The rating is only marginally better for the B.C. provincial government (28 per cent, up one point) and municipal governments (27 per cent, down two points). In Metro Vancouver, where mayors in the two most populous municipalities are in the first year of their tenures, 58 per cent of residents rate the efforts to deal with homelessness as “bad” or “very bad.”

When British Columbians rate the problem locally, the numbers are not particularly dramatic. About one in four (24 per cent, down three points) think homelessness is a major problem in their neighbourhood and 40 per cent (down two points) believe it has increased over the past three years.

The numbers on these two questions are stable when residents assess their municipality. More than half (52 per cent, unchanged) think homelessness is a significant issue and 64 per cent (up one point) say it is getting worse. Views are more fatalistic on a provincewide basis, with 80 per cent of respondents (up one point) saying that homelessness has increased across B.C.; 78 per cent (up five points) consider it a major problem.

One aspect where the perceptions of British Columbians seem to be hardening is the perceived causes of homelessness. More than three in five of the province’s residents (63 per cent, up three points) believe addiction and mental health issues are to blame “a great deal” for the current state of affairs – by far the highest number among five different issues tested.

Fewer than half of British Columbians (47 per cent, down six points) think a lack of affordable housing is to blame “a great deal.” The proportions are lower for poverty and inequality (34 per cent, down seven points), the personal actions and decisions of individuals (31 per cent, up one point) and a bad economy and unemployment (19 per cent, down five points).

The province remains split on whether this is a challenge that can be successfully tackled. For 50 per cent of British Columbians, homelessness can be eradicated with the proper policies and funding. For 48 per cent, it will always be a problem.

There may be a divide on the future, but not on some possible solutions to alleviate the crisis. More than four in five British Columbians (82 per cent, up two points) agree with increasing temporary housing options for people experiencing homelessness, and more than three in four (77 per cent, down one point) would offer incentives to developers if they focus on building affordable housing units.

Most British Columbians also favour two other policies: Devoting tax money to build units to house homeless residents (67 per cent, unchanged) and changing zoning laws to allow property owners to build more units on standard lots (62 per cent, up two points).

Some of the political players have changed, but the dissatisfaction of British Columbians on how homelessness is being handled remains. The survey confirms that most of the province’s residents continue to regard housing policies as their preferred way to mitigate the crisis. It is up to elected officials, whose favourability on this issue is painfully low, to take action.

Mario Canseco is president of Research Co.

Results are based on an online study conducted from April 23-25, among 800 adults in B.C. The data has been statistically weighted according to Canadian census figures for age, gender and region in Canada. The margin of error is plus or minus 3.5 percentage points, 19 times out of 20.

This article first appeared in Business In Vancouver.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

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