Experts anticipate more than $40 billion in food product imports this year, a rising figure due to several factors says a new report. The recent closures of several Ontario food processing plants, such as Kellogg Co., have resulted in an increase in cereal imports of 18%. The weakened Canadian currency will see increased prices on food products of 0.7% to 3.0% overall, especially on imported items such as fruits, vegetables, and nuts. Fluctuations in prices will have a particularly negative effect on vegetables, as there is a lack of substitutions on edible imported products. Making up nearly a quarter of the average Canadian household’s food expenses, the prices of vegetables are predicted to increase anywhere from 5.5 per cent to 7.5 per cent by the end of 2015.
The Food Institute of the University of Guelph first released the annual retail price report in December 2014 when the Canadian dollar was worth $0.88 against the American dollar. Since the Canadian dollar’s sudden fall, primarily due to the low crude oil prices and lower interest rates, the Food Institute made the decision to revise the food retail price forecast for 2015, published on February 3, 2015.