Cost of groceries in Canada up four per cent in October

Loblaws says grocery prices in Canada rose by four per cent this month, with general Consumer Price Index increasing 2.4 per cent.

The grocery chain’s October Food Inflation report says supplier prices have climbed sharply due to higher feed and energy costs, as well as tight livestock supplies caused by dry weather in key producing regions.

It says the removal of the federal government’s counter-tariffs on U.S. imports are expected to be fully realized in the coming weeks as retailers sell through inventory, has helped moderate food inflation.

Items like fresh and frozen meat and coffee are putting upward pressure on prices, both due, in part, to lower supply.

READ MORE: Increased demand, food costs hit Niagara school nutrition programs

Pork and poultry have been slightly more stable, though still above last year’s levels.

With feed costs and transportation expenses showing little sign of easing, Canadians can expect meat prices to remain high through the fall.

The report says retailers will continue working to secure affordable supply including from other source countries such as Australia and Mexico and promote value cuts where possible.

Produce prices remain volatile and are expected to rise further as colder weather reduces Canadian supply and imports from the U.S. increase.

California’s poor growing season — marked by water shortages and reduced yields — will likely push up the cost of many fruits and vegetables over the coming months.

Freight and labour costs add to this pressure, meaning produce could continue to increase compared to last year

READ MORE: Increased demand, food costs hit Niagara school nutrition programs

The report shows there is some good news on certain commodities.

The demand for chocolate has decreased after recent price spikes, pushing cocoa prices down.

Better crop forecasts in West Africa are also easing supply worries.

Brazil’s bigger-than-expected orange crop is easing concerns about orange juice shortages and helping prices settle.

Large harvests of sugar in Brazil and Thailand also mean more sugar on the market, bringing prices down.