WESTERN PRODUCER — Dumping costs on somebody else is no big deal if it doesn’t cost the dumper anything.
That attitude is a problem for farmers, the rest of agriculture and the food industry as the latest iteration of inflation-promoting measures makes life harder and profits thinner for everybody except the consumer. Or so the consumer thinks.
Genetically modified organisms? Don’t need any of that stuff.
Foreign-made food? Don’t want it.
Herbicides? Keep those yucky chemicals off my Cheerios.
Temporary foreign workers? Block them.
To most urban food-eaters, those things don’t seem to have anything to do with the stuff on grocery store shelves, other than in virtue-signaling labels that proclaim their absence. As far as they see, there is no connection to price at all.
Now food manufacturers and meatpackers are sounding the alarm because the number of temporary foreign workers they are allowed to employ might be scaled back, even though they have many unfilled vacancies and few Canadians fighting for the grueling work.
Meat regulations in the U.S. market, including both country-of-origin labeling and sow housing restrictions, are likely to boost pork and beef prices over the long run.
Restricting the chemicals farmers can use in crop production, regardless of their proven safety, boosts the farmer’s cost of production and reduces the likelihood he’ll bother growing that crop. That’s a problem for crops like oats and flax. Farmers grow less. Prices go up. Oatmeal gets more expensive.
But many consumers don’t think these interventions cost them anything. There’s no downside, they think, to imposing regulations, building barriers and banning products.
Farmers and their dependents, the food companies, need to address this if they want to avoid an escalation of cost-boosting measures that are becoming an ever bigger part of today’s politics. Until the consumer and citizen at large understands that every penny of cost eventually gets taken out of their pockets, there’s nothing to stop them from demanding more from food producers.
Farmers’ organizations should deal with this. Food companies should tackle this. Provincial governments that care about agriculture should confront this. There’s a disconnect between the public’s understanding of how production costs affect grocery store prices and how farmers and food companies experience the issue.
Canadians and consumers of Canadian-sourced foods around the world have grown accustomed to cheap food in recent decades, to the point at which “Food Freedom Day” was happening so early in the calendar year that food became a negligible part of the average family’s budget. (This year it was Feb. 9.) It’s hard to make people care about minor costs.
That cheapness has begun to fade. It’s hard to find a consumer today who doesn’t complain about food inflation, shrinkflation and other elements of higher food prices. Inflation has sliced a big piece from the family budget since 2021, and wage increases are nowhere near keeping up. Costs in every area of life having surged. Food inflation isn’t necessarily worse than many other types of inflation, but it’s harder to avoid.
A family can scale back an upcoming summer vacation, go to fewer movies and visit Boston Pizza less often, but it hurts to cut back on food in the fridge. Yet that is now what millions are forced to do.
However, it’s unlikely that urban consumers connect the price of their groceries to the sorts of price-boosting actions affecting farmers’ costs.
Farmers and the food industry need to address this. Until the consumer understands that every penny of cost imposed on a farmer eventually comes out of the consumer’s pocket, there’s no reason for them to care.
