Roundup: The drivers of food price inflation

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The September inflation numbers were released yesterday morning, and they are still cooling, but not quite by as much as anticipated, in part because food price inflation continues to stay high. While the temptation to conclude that this is entirely the fault of the grocery oligopoly engaged in price gouging, and boy howdy are the NDP trying to make this a Thing, we know from the economic data that it’s not actually the case. And it doesn’t take too much digging to know what some of the drivers of this food price inflation really are:

  • For cereal and bakery products, that’s because the drought on the Prairies destroyed 40 percent of crop yields last year
  • The blight known as “coffee rust” is affecting those crops, and is in large part because of monoculture
  • Drought has also taken out things like the chilis necessary for things like sriracha sauce, or the mustard crops used in condiments
  • Fresh fruit and vegetables are, again, susceptible to droughts in places like California, or the hurricanes that struck Florida
  • Fish and seafood are facing collapsing stocks, which again, drives up prices, and some harvesting seasons have been impacted by hurricanes
  • Dairy and meat has seen higher input costs (again, drought taking out feed crops) and avian flu ravaging poultry flocks is also driving up prices

As you can see, climate change is a big driver for most of these. Our food production is very vulnerable to it, and that is causing a lot of these price increases, and we need to be aware of that and stop couching it euphemisms about “inclement weather” or the like.

Meanwhile, Chrystia Freeland has told her Cabinet colleagues that they need to keep their spending priorities in check, and if they want higher spending, they need to be prepared to find savings in their departments to pay for them. While we have seen that the government’s fiscal stance is already pretty tight, Freeland needs to manage expectations right now—if we do go into a recession, the government can’t keep up the same supports they did during the pandemic, and broad spending programmes could wind up fuelling inflation and undoing the work the Bank of Canada is doing to tame it. It’s unlikely to really blunt any of the attacks from the opposition, and Poilievre in particular because he’ll just make up more nonsense that sounds like economics but is just bullshit, and certain people will spoon it up and legacy media will both-sides it, but regardless, Freeland looks to be steering the Liberals back on a course toward the brand of fiscal prudence and away from trying to capture more of the left, but perhaps that’s because they have put a mark in that territory with things like childcare and know that there are voters at the centre that the Conservatives are abandoning that they would rather pick up instead. Either way, it’s an interesting move.

Ukraine Dispatch, Day 238:

As Russians continue to bomb power stations around the country, Ukrainians are facing rolling blackouts. President Volodymyr Zelenskyy called out the Iranians for accepting “blood money” for these drone.  Meanwhile, Putin has declared martial law in the four occupied territories in Ukraine, giving his Russian regional governors emergency powers to enact new restrictions.

Good reads:

  • Justin Trudeau told a Climate Institute conference that Russia’s invasion of Ukraine helped to accelerate Canada’s move away from oil and gas.
  • As both an election promise and part of their deal with the NDP, the government will start consulting on “anti-scab” legislation that previous parliaments rebuffed.
  • The additional GST rebate bill got royal assent on Tuesday, and the government has needed to impose closure in order to pass the bill on the dental and rental supports.
  • Members of the Arctic Council want to ensure that a new cold war doesn’t develop in the region, particularly now that Sweden and Finland are joining NATO.
  • The Emergencies Act inquiry heard from the former head of the Ottawa Police board (complete with secret recording), and the intelligence chief for the OPP.
  • Pierre Poilievre is going to skip the Press Gallery Dinner this weekend, either because he’s being petulant with the media, or can’t make fun of himself.
  • Several Conservative MPs are “pissed off” by Doug Ford’s comments saying he’s “shoulder-to-shoulder” with the prime minister on the use of the Emergencies Act.
  • A second Quebec party wants to avoid swearing an oath to the King, but that’s entrenched in the federal constitution so good luck with that.
  • Jason Markusoff explains why the next Alberta election won’t be a slam-dunk for Rachel Notley, because it will largely be about battleground Calgary.
  • Heather Scoffield makes the case that the government should take a page from the Americans and go big on emissions reductions with a household strategy.
  • Paul Wells gives his take on mayor Jim Watson’s testimony at the public inquiry.

Odds and ends:

For Xtra, I sat down with Elizabeth May’s running mate, Jonathan Pedneault.

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