By Tom Parkin
January 28th, 2026
BURLINGTON, ON
Giving away $10 billion needed for health care, education and defence won’t do anything to root out the causes of Canada’s food inflation.
Annual rate of inflation, monthly, Jan – Dec 2025
Prime Minister Mark Carney announced a boost to the GST tax credit Monday, offering it as an offset to rapidly rising food prices squeezing low income families.
That the announcement came just two months after delivering a federal budget that had no mention of the $10 billion expenditure is a pretty clear signal food inflation took the prime minister by surprise and he felt politically pressed to do something.
Putting the cost on taxpayers won’t fix food inflation
But the return of food inflation could only have been a surprise to those who don’t pay for food or weren’t watching the data dashboard. As today’s chart shows, food inflation ran at or above the general price inflation all through 2025.
The Liberals’ enriched GST tax credit will benefit low-income Canadians, but not until July 2026, and there’s a lot of groceries to be bought before then.
But the real problem with Carney’s announcement is it does nothing to fix fosing food prices. It’s no different than the nonsense Canadians got from Pierre Poilievre, who claimed cancelling the carbon tax would end food inflation. Carney cancelled the carbon tax; inflation didn’t even notice.
Whether from Carney or Poilievre, a tax cut does not fix the source of food inflation, which lies inside our food supply chains. Worse, it just shifts the burden of food inflation onto the taxpayer or takes from other public priorities.
Canada’s food supply chain dominated by major players
It’s a job for people with more expertise than Data Shows to dig into the exact points where inflation is being injected into food prices. But it doesn’t take a lot of expertise to see where some we need some investigation, if anyone cared to do that.
One line of investigation has to be into anti-competitive practices by the three big grocery store companies. Loblaw (under their many banners), Empire (Sobey’s) and Metro, together control close to 90 per cent of the grocery sales in Canada. Due to regional coverage, shoppers in some towns or neighbours effectively face a monopoly.
Loblaw and Sobey’s have been lucrative enough business to make multi-billionaires out of the families controlling them. Metro ownership is institutional.
As our chart below shows, despite the endless ideological complaints about supply management, it’s not milk and eggs driving up food bills. It’s not vegetables. Or even fruit, which we don’t have much control over in December. The driving force is meat, particularly beef.
Price index change, Dec 2024 to Dec 2025
Ground beef was up 16.3 per cent and stewing beef rose 12.4 per cent from December 2024 to December 2025. Steak cuts were up even more, even as general inflation rose only 2.4 per cent.
That is not normal, explainable or tolerable.
Like grocery retailing, the meat-packing industry is also dominated by a small group of extremely rich and politically influential people, making it an obvious place to shine a light for anti-competitive practices. The JBS meat-packing plant in Brooks, Alberta, and two Cargill plants in High River, Alberta and Guelph, Ontario accounted for 84 per cent of federally-inspected beef.
JBS is based is Brazil and was subject of parliamentary inquiry that found the company received billions in subsidies that lacked transparency and were politically influenced. Company owner Wesley Batista, son of JBS founder José Batista Sobrinho and key member of the billionaire family, was imprisoned for insider trading in 2017.
Cargill is privately owned by the Cargill-MacMillan family, which has accumulated $60 billion.
According to the Canadian Cattle Association, against these beef industry behemoths cattle ranchers are price-takers, not price-setters, and it’s downstream from there the inflation is growing.
In the United States there have been recent and successful anti-trust class-action settlements against meat companies after accusations they conspired to inflate prices.
And of course, here in Canada an illegal price-fixing scheme continued for years without detection or disruption by a toothless Competition Bureau. No one faced criminal charges despite a $500 million settlement in favour of Canadian food shoppers.
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Hi Tom Parkin.
I enjoyed your article and its nice clear graphics. All very good points, though your main focus is rather like leaning against the cost of gasoline in this country – or any other, for that matter.
I am wondering why you put the focus on beef? Who, in their right mind, buys much beef these days? We all know red meat is a no-no for one’s health and one’s longevity.
And you did not include chicken thighs, chicken quarters or pork cuts in with the expensive meats. These are my own staples as they are still so cheap on sale at Food Basics, along with FB’s frequent specials on potatoes, carrots and onions. A mention of these cheap meats & such ‘special’ opportunities would make a nice contrast in an accompanying paragraph or three for your article. Or perhaps you already have these lined up for a thoughtful future article.
Oh, and by the way… I suggest you hire a proof reader to catch all those extra words and other in-your-face things in your article. Very irritating for the reader. And really annoying for a retired QC person such as myself.
All the best, Tom. I enjoyed your article and look forward to reading your future work.
J.H. ‘Sam’ Weller, Burlington.
I knew Tom would figure out how to turn at least part of his message into a hit on Poilievre. Of course Tom, a strident NDPer, doesn’t like the idea of cutting taxes. His party has always been one of big government. And of course, Tom hates big business, that’s why this article focuses so much on the role of big business in the food chain.
Has eliminating the consumer portion of the carbon tax reduced food prices? Of course not. But Tom once again only told part of the story. But Poilievre’s cut would have eliminated the industrial carbon tax where the carbon tax has its greatest impact on the cost of food production–in transportation and energy costs at every step in long distribution channels in the food industry. I hope readers realize the hypocrisy in the recent Carney announcement that they were giving tax breaks on the construction of greenhouses to boost Canadian food production; what Carney failed to say was that greenhouse growers who maintain high carbon dioxide levels in their greenhouses to boost production ARE TAXED on their use of carbon dioxide.
And Tom failed to analyze other government policies that contribute to food inflation in Canada, notably supply management, increased regulatory requirements (notably in packaging) and the falling value of the $C during the 11 year Liberal interregnum which increases import prices.
Undoubtedly there has been some profiteering in the food industry, a problem which is greatest at the wholesale levels. However, to accuse food retailers of being the problem is a simplistic and convenient excuse for those who seek to absolve government responsibility in the problem. If price gouging were a problem at the retail level, I would expect gross margins on food retailing to be rising. However, they are not. Retailers need to earn a profit so when their cost of buying food rises those cost increases are passed on in higher prices. Are food retailers profitable–certainly they are and they are increasingly so. Why have net profits been increasing? Two main factors–sales have been increasing with population growth and the increasing trend to eat at home rather than dine out (again due to inflation). Secondly, these stores have been growing the non-food side of their operations–pharmacy, cosmetics, hardware, financial services–where margins are considerably higher than on food.
Lastly consider the Liberal government’s focus on increasing competition in the food industry in late 2022 and early 2023. Ask yourself why NO foreign competitor (US or European) has considered setting up in Canada if it is so wildly profitable. Perhaps they look at the over-regulated Canadian market and decide it isn’t worth the risk to earn 3 to 4 cents on each dollar of sales.