Is Statistics Canada underreporting food inflation?

Smart Strategies for Families: Navigating Grocery Shopping in a Shrinkflation Economy In today's economy, families are feeling the pinch as prices continue to rise and the phenomenon of shrinkflation becomes more prevalent. Shrinkflation, the sneaky tactic used by manufacturers to reduce product sizes while maintaining the same price, means consumers are paying more for less. In such challenging times, it's crucial for families to adopt savvy shopping habits to make every dollar count. Here are some practical tips to help your family save money while grocery shopping: **1. ** Strategic Planning with Coupons: Coupons are your secret weapon against rising prices. Keep an eye out for coupons in newspapers, online, or through store apps. Many grocery stores also have loyalty programs that offer exclusive discounts to members. By combining coupons with store promotions, you can maximize your savings significantly. **2. ** Create a Shopping List: Planning is key. Before heading to the store, make a list of essential items your family needs. Organize the list based on categories such as fruits, vegetables, dairy, and household essentials. Stick to your list to avoid impulse purchases, which can quickly add up. Planning your meals for the week can also help you buy only what you need. **3. ** Take Advantage of Sales: Pay attention to weekly sales and discounts offered by your local grocery stores. Base your meal plans around these sales to make the most of your budget. Buying items in bulk during sales can save you money in the long run, especially for non-perishable goods like canned goods, pasta, and toiletries. **4. ** Buy Generic Brands: Name brands often come with a higher price tag. Generic or store brands usually offer similar quality at a lower cost. Give them a try, and you might be pleasantly surprised at the savings without compromising on the quality of your groceries. **5. ** Embrace Fresh and Seasonal Produce: Opt for fresh, seasonal produce as they are not only healthier but also more affordable. Local farmers' markets often offer fresh produce at lower prices than supermarkets. Buy in bulk, freeze, or can seasonal fruits and vegetables to enjoy them throughout the year without paying a premium. **6. ** Minimize Food Waste: Be mindful of expiration dates and plan your meals to use up perishable items before they go bad. Store leftovers properly, and consider meal prepping to avoid waste. You can also get creative with recipes that use leftover ingredients, reducing your overall grocery expenses. **7. ** Comparison Shopping: Don't settle for the first price you see. Compare prices between different stores, and consider shopping at discount or warehouse clubs for bulk items. Just be sure to calculate the unit price to ensure you're getting the best deal. **8. ** Utilize Cashback and Rewards Programs: Several apps and credit cards offer cashback and rewards for grocery purchases. Take advantage of these programs to earn back a portion of your expenses, which can add up over time. **9. ** DIY Whenever Possible: Instead of buying pre-packaged or processed foods, consider making them at home. Items like snacks, sauces, and even bread can be prepared at home for a fraction of the cost of store-bought alternatives. **10. ** Stay Informed: Stay updated on market trends, price fluctuations, and new discounts by following grocery store newsletters, social media accounts, or apps. Being aware of the best deals and discounts can help you plan your shopping trips more effectively. In conclusion, navigating the grocery store in a shrinkflation economy requires diligence and strategic planning. By embracing these tips, your family can save money without sacrificing the quality of your meals. With a little effort and smart decision-making, you can make your grocery budget stretch further and adapt to the changing economic landscape.
Planning your grocery shopping can help save money and make ends meet.

Is the food inflation data from Statistics Canada reliable? An analysis says no

By Sylvain Charlebois

Statistics Canada’s reports suggest that food inflation is easing, and prices are gradually stabilizing. However, many consumers are not experiencing this stabilization firsthand. This perceptual discrepancy has raised questions about the accuracy of Statistics Canada’s data on food prices.

Evaluating the accuracy of the federal agency’s data has proven difficult, but recent analysis provides some insights. Through systematic price checks across the country, a discrepancy between Statistics Canada’s reports and the Agri-Food Analytics Lab’s Price Portal data has emerged. While variations in methodologies and data access can vary, the discrepancy raises concerns about the reliability of national statistical forecasts and their implications for consumers and policy decisions.

Is Statistics Canada underreporting food inflation?For example, last week, Statistics Canada released the February 2024 list of selected food products showing significant differences compared to the prices observed in grocery stores. That list is always released a few weeks after the CPI. When comparing our list of prices with Statistics Canada’s data, we found that the Mean Absolute Error (MAE) between the two lists is 5.59. This means that, on average, prices reported by Statistics Canada deviate from the actual observed values by 5.59 percentage points.

Specifically, data from February 2024 reveals significant variances in food price changes. For instance, oranges were reported at -6 percent by Statistics Canada, while our data shows an increase of 20.1 percent. Similarly, avocados were reported at -4 percent by Statistics Canada, compared to our observation of a nine percent increase. These discrepancies are not isolated; they are part of a pattern where 47 percent (16 out of 34 items listed) of food items are underestimated by Statistics Canada. This suggests that the agency’s reports may not always accurately reflect food inflation, although it does not indicate a deliberate underestimation.

The implications of these underestimations and overestimations are significant. For consumers, it means that the cost of living might be higher than anticipated, impacting household financial planning. For the economy, it suggests that inflation in the food sector might be more pervasive than official figures indicate, potentially leading to misinformed policy decisions.

The MAE of 5.59 is not just a statistical figure; it represents the variance in real-world costs Canadians face daily. This variance can exacerbate the financial strain on families and may necessitate a recalibration of social assistance programs to accurately reflect the cost of living.

Improving the accuracy of food price data will require Statistics Canada to refine its data collection and analysis methods. The agency should consider collaborating with independent research bodies to enhance data reliability. Such a collaboration would ensure that the data accurately reflects market trends and facilitates better-informed decision-making.

In October, Minister of Innovation, Science and Industry François-Philippe Champagne announced an investment in the Contributions Program for Non-Profit Consumer and Voluntary Organizations to broaden the scope of existing consumer projects, including expanding research in the retail sector, specifically in groceries. However, further investment is necessary.

Regardless of public opinion, Statistics Canada remains a crucial source of economic indicators. However, these are just that – indicators. Canada could benefit from a broader spectrum of reliable data sources.

While there is no reason to believe these differences are deliberate, the discrepancies highlighted by Dalhousie University’s Price Checks urge a re-evaluation of how food price data is collected and reported in Canada. Canadians need to feel confident about the accuracy of the federal agency’s reports.

Addressing these discrepancies is crucial for better budgeting and policy planning, ultimately affecting the economic well-being of all Canadians.

Dr. Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.

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The views, opinions and positions expressed by all columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of NETNEWSLEDGER.

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