Ontario residents have long been frustrated over soaring grocery prices, particularly at stores like Loblaws (TSX: L), whose profits have surged as consumer costs rise. The outcry has received renewed attention – this time because it seems like prices at local groceries have been so bad that produce from Ontario now appear to sell for much less in the US.
A viral TikTok video from Mississippi shows a woman questioning how a bag of carrots from Ontario, priced at US$0.86, could be significantly cheaper than the same product in Ontario, where another TikToker claims it costs around CA$3.
While some mention factors like currency conversion, Canada’s carbon tax, and higher wages, others attribute it to “greedflation.” The issue resonates with comments nationwide on TikTok about inflated prices.
While specific product details were not available on the Loblaws website, comparable items indicate a price range of $2.49 to $3.99 for various carrot products. Some users on TikTok humorously referred to the situation as “Galen Weston math.”
One commenter pointed out the wage difference between Mississippi (US$7.25 per hour federal rate) and Ontario (CA$16.55 to as much as CA$20 per hour) as a possible cost driver. While others of course had to mention the carbon tax.
Dr. Sylvain Charlebois, director of the agrifoods analytics lab at Dalhousie University, told the Toronto Sun that there are several potential reasons for the price gap.
He cited grocers adopting different pricing strategies based on customer demand and inventory levels, as well as the use of loss-leading tactics to attract customers. Charlebois also highlighted the impact of listing fees that suppliers have to pay, potentially leading to increased prices to cover these expenses.
“These fees can be burdensome and may lead suppliers to increase prices to cover these expenses,” Charlebois said. “This issue is particularly prevalent in Canada, which is something Canadians know little about. This highlights the importance of implementing a grocer’s code of conduct to address this concern.”
Charlebois emphasized the need for a grocer’s code of conduct to address these concerns, urging consumers to shop around for better deals.
Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.