Loblaw warns Canadians of price hikes
Canadians should brace for more expensive groceries. Loblaw Companies Limited, a major Canadian retailer, warns that prices on everyday essentials will continue to climb. This is largely due to the impact of U.S. President Donald Trump's tariffs, which are increasing costs for goods imported from the United States.
Loblaw Companies Limited, parent company of major Canadian grocery chains like Loblaws, No Frills, and Real Canadian Superstore, released its May food inflation report on Tuesday, May 27. The report indicates that thousands of everyday items are set to rise in price. While this isn't welcome news for Canadians struggling with grocery bills, the retailer noted that the increases could have been even more severe.
Loblaw has indicated that recent government actions, specifically a six-month reprieve on tariffs for certain U.S. food manufacturing and packaging imports, are helping to prevent a drastic surge in grocery prices. The stabilization of the Canadian dollar is also contributing to mitigating the risk of a sharp or prolonged spike in food inflation.
Loblaw has confirmed that the Canadian government's recent decision to exempt 'indirect tariffs' on certain US imports will help stabilize food prices. This applies to products like chocolate chips or peanuts, which are used as ingredients in goods manufactured in Canada.
Previously, these indirect tariffs were a significant concern for food costs due to the widespread use of imported components in Canadian-made products. With this change, only final products imported from the US will now be subject to tariffs, offering relief across a substantial number of items on supermarket shelves.
Despite some relief, Loblaw states that tariffs continue to apply to thousands of different items, including a wide range of food products imported from the U.S. This impacts categories such as produce, rice, pasta, dairy, and coffee, alongside health and wellness products like soap, shampoo, and cosmetics. Loblaw estimates that consumers can expect tariff-related price increases on approximately 6,000 items in a conventional grocery store, with roughly half of these being food products.
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