Food prices in Canada rise at faster pace than overall inflation, 12 months in a row

Grocery inflation in Canada surged again in November as the price of basics like bread, eggs and dairy products shot up.

Prices for food purchased from stores rose 11.4% last month compared with a year ago, up from an 11% gain in October, according to Statistics Canada numbers released Wednesday (Dec. 21).

Grocery prices have now risen at a faster pace than overall inflation for 12 months in a row.

The country's annual inflation rate edged down slightly in November to 6.8%.

Coffee and tea prices were up 16.8% in November while items such as butter climbed 23.1%, eggs rose 16.7% and bread, rolls and buns were up 18.2%.

Other items to jump in price include sugar and syrup, up 18.8% year-over-year, pasta products up 17.1%, lettuce up 31.9% and flour and flour-based mixes up 20.5%.

Rising grocery prices is a global phenomenon, with countries like France, Germany and the U.K. posting even higher food inflation rates than Canada last month, said Sylvain Charlebois, professor of food distribution and policy at Dalhousie University.

Still, much of Canada's food is produced domestically, and prices are increasing due to a host of factors including higher labour, input and energy costs, he said.

"A lot of collective agreements are being negotiated with wage increases of over 5% and that's putting pressure on the cost to produce anything,'' Charlebois said. "One example is the packaging that food companies use. We've seen prices of packaging like egg cartons go up significantly.''

It could be some time before Canadians see food prices stabilize, he added.

"We're still in this for the next four to six months,'' Charlebois said. "We are expecting things to come down in the spring.''