New APAS study shows farmers are NOT the reason for food price inflation
The Agricultural Producers Association of Saskatchewan (APAS) has released its final report on Farmers and Food Prices after a full year of study, consultation, and review, indicating that food prices are not driven by the farm gate.
APAS president Ian Boxall, emphasizing the newly released report's key finding, stated, “Farm families are not to blame for higher grocery prices. Despite fluctuations in commodity prices, food prices and farm input costs continue to rise, challenging the notion that farmers are the cause of expensive groceries.”
Boxall adds, “While we have seen strong commodity prices in the recent past, many of those commodities are experiencing a downturn, but the same cannot be said for food prices or the escalating farm input costs.”
Along with Kevin Grier Market Analysis and Consulting, APAS examined eight separate consumer products to determine the farmer’s share of the retail price. The products examined included flour, bread, canola oil, margarine, lentils, beer, retail beef, and retail pork. The report employs the United States Department of Agriculture (USDA) methodology to determine the quantity of a farm commodity required to produce a unit of the final consumer food product.
The data presented in the report dismantles the assumption that there is a direct correlation between farm gate prices and grocery food prices. In no instance did the study find that grocery food inflation was exclusively attributed to increases in commodity prices.
“The increasing food prices consumers are experiencing at the grocery store are not driven by farmers,” said Boxall. “The report shows the stark discrepancy between commodity and food prices. For instance, in October, canola prices declined by 21 per cent, yet margarine increased 17 per cent. Wheat saw a 19 per cent decrease, yet flour and bread increased by four per cent and three per cent respectively. Barley decreased by 16 per cent, but beer surged by 19 per cent.”
“The goal of the report,” Boxall added, “is to enhance transparency along the supply chain, shedding light on the portion of food costs returned to farm and ranch families. We wanted to provide clarity on this critically important issue and contribute to a more informed understanding of the factors influencing food prices.”
The much-anticipated final report was released at the 2023 APAS Annual General Meeting in Regina on December 5.