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Farmers complain about rising prices, demanding the government to pressure major companies and grocery stores.

Farmers complain about rising prices, demanding the government to pressure major companies and grocery stores.

By عبد السلام

Published: June 18, 2022

The rising cost of food means Canadians are paying more for meat, fruits, and vegetables, but this money is not going back to the farmers. Bill Eek from his farm in Holland Marsh, Ontario said, "We do not take money from consumers."

The Eek family grows carrots and onions three times a year, and have seen the increase in the cost of buying everything essential for their farm. Eek said, "The important thing is fuel, it is double what it was last year."

The Russian invasion of Ukraine, ongoing pandemic supply chain issues, and labor shortages have contributed to record inflation. According to Statistics Canada, Canadians are paying nearly 10 percent more for food than they did last year.

Stuart Wells, a farmer in Swift Current, Sask., and also works with the National Farmers Union. He says farmers are under pressure as they have to pay more to grow and harvest crops, but they are unable to charge more to sellers. Wells said, "The prices of everything we buy, and every raw material we use to grow a crop, have increased much faster than the prices we receive."

Meanwhile, grocery companies are recording record profits. In the first quarter of 2022, Metro recorded a 5.3 percent increase in net profits, while Empire, which owns Sobeys, experienced a 15.4 percent increase.

Loblaws' profits increased by 40 percent. David Macdonald, chief economist at the Canadian Centre.

But he adds that companies are able to pass on the increase in commodity costs to consumers, and the net result is that the grocery store industry made $4 billion more in 2021 than it did in 2019 before the pandemic.

In a statement, Loblaws said, "The implication that grocery store profits lead to food price inflation is completely wrong and misleading." The company adds that groceries are a low-margin business "making less than four cents on every dollar sold" in the last quarter. Metro says its overall profit margins have not essentially changed, attributing growth increases to strong sales in its pharmacy business.

Canadian companies are not alone in making record profits over the past two years. Macdonald says energy companies and grocery stores should pay more taxes, and also suggests they pay a one-time 15 percent tax imposed on banks and insurance companies that made record profits during the pandemic.

Grocery stores have made a lot of money, and oil and gas companies will make record profits this year. Macdonald said, "Let's make everyone pay this price and use it for some good purposes like transferring to low-income households struggling to afford food and gas."

There are also calls for energy companies to pay what is called a "windfall profits tax." This week, Green leader Sonia Furstenau joined her counterparts in New Brunswick and P.E.I. in calling for a national tax on oil and gas company profits."

Across Europe right now, we are seeing countries bring these unexpected taxes to energy companies benefiting from the war in Ukraine. Canada should do the same."

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