Grocery store CEOs warn of higher prices
The CEOs of three of Canada’s major grocery chains doubled down on their expectation that food prices will soon rise at their stores.
Recent cost pressures on the industry, including rising minimum wages in some provinces, increased fuel and transportation costs and an ongoing trade war with the U.S., will soon result in some price inflation, said the chief executives of Metro Inc., Loblaw Companies Ltd. and Empire Co. Tuesday at a conference in Toronto.
Metro CEO Eric La Fleche said consumers should eventually see a return to more normal inflation levels.
“Exactly when and how — it’s all about competitive dynamics. Everybody is competitive. Nobody wants to lose any share. So, let’s see how things play out,” he said.
Metro is starting to see some price inflation already, La Fleche said.
He explained that the cost pressures have been building over the past year, beginning with Ontario’s minimum wage hike from $11.60 to $14 an hour on Jan. 1, followed by rising fuel and transportation costs.
Then came the Canadian government’s retaliatory tariffs on July 1 on a wide range of American products, including coffee, maple syrup, salad dressing and other foods.
“Now, we’re having a — what I would describe it as — a tsunami of tariff-related request for cost increases from our supplier partners,” said Michael Medline, Empire’s CEO.
Empire will pass the extra costs on to consumers where it makes sense in the market, he said, adding it will be careful not to give away any market share.