Loblaw ends price freeze

Analysts say grocery costs to rise ‘across the board’

On Tuesday Loblaw ended its No Name product price freeze as experts warned more food price increases from large supermarket chains will hit Canadian consumers’ wallets in coming weeks.

“The more than three-month price freeze ends Jan. 31,” a Loblaw spokesperson said in an email to the Star. Canada’s largest food retailer, which includes brands like President’s Choice and Joe Fresh, did not respond to questions about how much prices are expected to increase once the freeze is over, but said it would keep the product pricing flat “wherever possible” for its in-store discount brand, No Name.

Price freezing over the holiday season, from November to February, is a common industry practice. When Loblaw in October made a show of announcing that it would freeze prices on 1,500 No Name brand products until Jan. 31, to give Canadians a break amid rising inflation, it was panned as a PR stunt and seen as further evidence that retailers have more control over food prices than they’re acknowledging.

No Name products are not the only items that will jump in price this month as the blackout period for price increases at other grocery retailers also comes to an end. Consumers should brace themselves for food price increases across the board at grocery stores this spring, said food industry analyst Sylvain Charlebois, as Metro’s price freeze expires in February at the same time the price of milk and butter are expected to increase.

“Food prices will increase across the board” with dairy products impacted the most, said Charlebois.

The jump in dairy costs was anticipated after the Canadian Dairy Commission in November said it approved an increase in farm gate milk prices of about 2.2 per cent, or just under two cents per litre, effective Feb. 1.

This followed the commission’s approval of two previous price hikes in 2022: a 2.5 per cent increase in September and 8.4 per increase last February.

The Crown corporation, which oversees Canada’s dairy supply management system, said the increase is due to the rising cost of production.

“The cost of dairy has been a problematic category for quite some time,” Charlebois said. On Feb. 1 “we’re going to see the third price increase in a year. When you combine all the increases, it amounts to over 14 per cent in total since February 2022.”

The increase will put pressure on dairy processing costs and eventually on consumers, Charlebois said. Dairy products will be impacted differently but a rise in the price of milk is likely to be felt faster in coming weeks, followed by yogurt and cheese.

How fast price increases will take effect on No Name products at Loblaws — and by how much — will depend on specific products and the store location, Charlebois said, but non-perishable items, including cookies, crackers, pasta and canned goods, will likely see an uptick throughout the spring.

“Everything that would require some processing is likely to be impacted,” he added.

Metro’s price freeze expires in February at the same time the price of milk and butter are expected to increase