Ā鶹“«Ć½

World

    • Italy may have dodged a ā€˜pasta strikeā€™ but food inflation is still high. Hereā€™s why

    Customers look at packages of pasta on sale in a supermarket in Milan, northern Italy, Thursday, June 8, 2023. (Luca Bruno/AP Photo) Customers look at packages of pasta on sale in a supermarket in Milan, northern Italy, Thursday, June 8, 2023. (Luca Bruno/AP Photo)
    Share
    London -

    Italians were supposed to be on a ā€œpasta strikeā€ this week but it was called off after prices for the national staple started to fall. Zoom out, though, and global food prices are still far higher than a year ago, despite precipitous drops in the cost of key raw materials.

    Assoutenti, an Italian consumer rights group, had accused food producers of profiteering and urged shoppers not to buy any pasta for nine days this month, starting last Thursday. But it shelved the plan, citing ā€œnoticeableā€ falls in pasta prices.

    Pasta prices dipped in May compared with April, though provisional official data released Wednesday showed that they ticked up again this month. Compared with last year, prices jumped by just over 12 per cent in June.

    Broader food price inflation, albeit slowing, is still high in Italy and elsewhere.

    Food price rises in the 20 countries that use the euro eased to 12.5 per cent in May, from 13.5 per cent the previous month, while in the United Kingdom, annual food inflation declined to 18.4 per cent from 19 per cent in April. The trend is more pronounced in the United States, where grocery prices increased by only 5.8 per cent in May, after outright falls in March and April.

    But the numbers are cold comfort to hard-up consumers. Prices are still high, despite recent dramatic drops in the cost of inputs like energy and wheat.

    In the UK, a block of cheddar cheese was 38 per cent more expensive in May than a year before. In France, over the same period, the cost of fresh vegetables rose 18 per cent, and in the U.S. margarine was up 17 per cent. In Germany, food prices continued to show above-average increases, clocking an estimated 13.7 per cent rise this month, the countryā€™s statistics office said Thursday.

    Concerns have grown that retailers and food producers are deliberately keeping prices high to boost profit margins ā€” claims they strenuously deny.

    So what gives?

    TIME LAG

    It has been 18 months since Russia launched its full-scale invasion of Ukraine in late February 2022. Food and fuel prices, which were already rising around the world, soared as a result.

    But global commodity markets have since given up those gains. Prices for both wheat and Brent crude oil ā€” which feeds into food production and transportation costs ā€” are about a quarter below their levels before the war. The wholesale price of natural gas, a key ingredient of fertilizers, is down 36 per cent from its level immediately before the invasion.

    Even so, it can take time for these falls to show up in retail prices, Danni Hewson, head of financial analysis at investment firm AJ Bell, told CNN.

    ā€œIt takes time for food to make the journey from field to fork, with some heavily processed foods taking months to find [their] way to our supermarket shelves,ā€ she said. ā€œThe stuff in tins and tubs today was probably made with ingredients sourced last year with last yearā€™s price tag.ā€

    ā€œSupermarkets themselves sign long-term deals with suppliers at a price that can only be amended once, and that change would have been made in the immediate aftermath of Russiaā€™s invasion of Ukraine,ā€ she added.

    Bank of England Governor Andrew Bailey said Wednesday that one of the consequences of the surge in energy and other commodity prices last year was that many UK businesses had ā€œbought forward supplies to a much greater extentā€ than usual. That meant they had ā€œlocked in higher pricesā€ for longer, he told a gathering of central bankers in Portugal.

    Costs of other inputs are also historically high, or increasing.

    According to Mintec, a commodities data firm, the cost of packaging across Europe, while down from spring last year, is still nearly a third higher than its five-year average before the pandemic.

    Given ā€œexceptionalā€ price rises in the aftermath of the Ukraine war, some commodity prices have further to fall, Andrew Woods at Mintec told CNN.

    ā€œIf you take a longer-term view, the prices are still quite high,ā€ he said.

    Labour costs are also elevated: Although hourly wages across the European Union fell last quarter, they are still well above their average levels over the past decade.

    Jack Allen-Reynolds, a senior European economist at Capital Economics, wrote in a note this week that he expected ā€œwage growth to remain high for some timeā€ in the food supply chain because ā€œan unusually large share of food producers report that labour shortages are a constraint on their output.ā€

    ā€œThis will offset some of the effect of lower agriculture and energy prices,ā€ he said.

    The UK saw 7.2 per cent growth in wages between February and April compared with the same period in 2022. Thatā€™s a record increase when excluding a sharp rebound in pay in the immediate aftermath of the pandemic.

    PROFITEERING?

    Still, sticky food prices have fueled suspicions that retailers and producers are using the war in Ukraine as a cover to needlessly inflate prices in order to boost or maintain their margins ā€” a practice dubbed ā€œgreedflation.ā€

    Speaking Tuesday, Christine Lagarde, President of the European Central Bank, said ā€œthe sheer scale of input cost growth made it harder for consumers to judge whether price hikes were caused by higher costs or higher profits.ā€

    NestlĆ©, the worldā€™s biggest food producer, said in April that it expected a profit margin of 17-17.5 per cent this year, about the same as in 2022. The company noted it had raised its prices by 9.8 per cent in the first quarter, compared with the same period last year.

    A NestlĆ© spokesperson told CNN that it had absorbed rising costs ā€œto the tune of billions of dollarsā€ and was ā€œdoing everythingā€ it could to help consumers.

    A mix of pent-up demand after the pandemic, high levels of savings and well-publicized supply chain issues have given ā€œfirms more scope to test consumer demand with higher prices,ā€ Lagarde said.

    The authorities are taking notice: The French government said earlier this month that it had secured pledges from 75 food producers to lower some of their prices from July in line with falling wholesale costs.

    Competition watchdogs in the UK and Sweden are investigating potential profiteering. Swedish authorities said Tuesday that the sticker price of eggs had risen by ā€œmore than what can be justifiedā€ by retailersā€™ costs, though it added that firm conclusions could not be drawn while their investigation was at an early stage.

    UK supermarket bosses, addressing lawmakers Tuesday, denied accusations of profiteering, arguing that costs along their supply chain were still elevated, and that they had already cut prices across a range of staple products.

    However, on Wednesday UK finance minister Jeremy Hunt doubled down on his scrutiny of the grocery sector, agreeing in a meeting with the Competition and Markets Authority that it will speed up its review of pricing in the sector.

    The meeting ā€” also attended by regulators for the energy, water, media and financial industries ā€” was called to secure commitments from industry watchdogs to ensure consumers were ā€œnot being exploited,ā€ the finance department said in a statement.

    In Italy, Cristiano Laurenza, who represents pasta producers at Unione Italiana Food, an industry association, said concerns over profiteering by pasta makers were ā€œentirely excessive.ā€

    ā€œWe should not overlook the fact that production costs, including energy, gas, logistics, packaging and raw materials, remain relatively high compared with the past.ā€

    Valentina Di Donato and Hanna Ziady contributed reporting.

    CTVNews.ca Top Stories

    A team of tornado experts is heading to Fergus, Ont. after a storm ripped through the area Sunday night.

    Why brain aging can vary dramatically between people

    Researchers are uncovering deeper insights into how the human brain ages and what factors may be tied to healthier cognitive aging, including exercising, avoiding tobacco, speaking a second language or even playing a musical instrument.

    Canada

    • A team of tornado experts is heading to Fergus, Ont. after a storm ripped through the area Sunday night.

    • Two nephews of the beloved Harry R. Hamilton share stories about his life and legacy.

    • The union representing some 1,200 dockworkers at the Port of Montreal has overwhelmingly rejected a deal with their employers association.

    • A man who was critically injured in a police-involved shooting in Hamilton late Sunday afternoon has died in hospital, says the provinceā€™s police watchdog.

    World

    Politics

    • Murray Sinclairā€™s family members say the late justice and senator has been laid to rest according to his wishes.

    • Prime Minister Justin Trudeau announced voters in Cloverdaleā€”Langley City will pick their next member of Parliament on Dec. 16.

    Health

    Sci-Tech

    Entertainment

    Business

    Lifestyle

    Sports

    Autos

    Local Spotlight

    For the second year in a row, the ā€˜Gift-a-Familyā€™ campaign is hoping to make the holidays happier for children and families in need throughout Barrie.

    Some of the most prolific photographers behind CTV Skywatch Pics of the Day use the medium for fun, therapy, and connection.

    A young family from Codroy Valley, N.L., is happy to be on land and resting with their newborn daughter, Miley, after an overwhelming, yet exciting experience at sea.

    As Connor Nijsse prepared to remove some old drywall during his garage renovation, he feared the worst.

    A group of women in Chester, N.S., has been busy on the weekends making quilts ā€“ not for themselves, but for those in need.

    A Vancouver artist whose streetside singing led to a chance encounter with one of the world's biggest musicians is encouraging aspiring performers to try their hand at busking.

    Ten-thousand hand-knit poppies were taken from the Sanctuary Arts Centre and displayed on the fence surrounding the Dartmouth Cenotaph on Monday.

    A Vancouver man is saying goodbye to his nine-to-five and embarking on a road trip from the Canadian Arctic to Antarctica.

    • LIVE

      LIVE

      Thousands of people are gathered in downtown Vancouver to observe the cityā€™s 100th Remembrance Day ceremony.

    • A suspect was arrested for allegedly brandishing a knife outside a Vancouver elementary school on Friday ā€“ just as the young students were heading home for the day.

    • Several hundred people gathered outside the Ontario legislature in Toronto to honour veterans and remember those who died fighting for their country.

    • Toronto is expected to see an economic boost to the tune of nearly $300 million thanks to Taylor Swiftā€™s upcoming Eras Tour, which will be making a stop in Canadaā€™s largest city for a six-show run later this month.

    • A man believed to be in his 40s has been rushed to a trauma centre following a stabbing in downtown Toronto.

    • Calgarians will be observing Remembrance Day at a number of different ceremonies across the city, including at the Hangar Flight Museum.

    • July 2025 may seem like itā€™s in the distant future, but for the St. Luke playground committee time is ticking to fundraise the $340,000 they still need to build a new playground.

    • Getting out to the mountains is even easier with a new bus route from a growing Germany-based service.

    • Crowds gathered in Ottawa and eastern Ontario on Monday to honour the sacrifice of men and women in uniform who gave their lives in service of Canada.

    • CTVNewsOttawa.ca looks at Remembrance Day ceremonies in Ottawa.

    • After months of controversy surrounding a dog park in Ottawa's west end, a solution has been reached to divide the park in half.

    • A 36-year-old Montreal man who was out on bail after allegedly uttering death threats to a woman is now accused of murdering her on the South Shore.

    • With fewer interments and rising maintenance fees, the money for Canada's largest military cemetery will run out in three to four years.

    • Montreal Metro passengers can now flag a safety concern by texting a new phone number launched by the STM.

    • WEATHER

      WEATHER

      This is shaping up to be one of the warmest Remembrance Days in the past decade, at least, for temperatures.

    • A local author is sharing his experience with alcoholism with the hope of helping other men improve their mental wellness.

    • Many Maritimers turned out in wet and windy weather Monday to remember those who have served, and continue to serve, in Canada's armed forces for Remembrance Day.

    • A Cape Breton senior recalls her life in German-occupied France, and her motherā€™s death, during the Second World War.

    • Thousand of people gathered at the Menin Gate in the Ypres, Belgium for Mondayā€™s Remembrance Day Ceremony.

    • Remembrance Day is today, and a number of ceremonies are taking place around the province to honour those who gave their lives to serve our country.

    • A pillar in Canadaā€™s history was honoured in Winnipeg Sunday afternoon, with thousands showing up to pay tribute to the life and legacy of the late Murray Sinclair.

    • Winnipeg police have identified two men involved in a stabbing incident earlier this week.

    • There will be two ceremonies taking place in Regina for Remembrance Day, hosted by the Royal Canadian Legion.

    • Regina author Valerie Crowther is celebrating the release of her book ā€˜War Letters: Linking Lives in the Second World War.ā€™

    • It was a somber day at Mosaic Stadium as members of the Saskatchewan Roughriders officially cleaned out their stalls and closed the book on the 2024 season.

    • Saskatchewan RCMP are searching for a suspect after a man was seriously injured in a farm-related incident in Montreal Lake.

    • It was a somber day at Mosaic Stadium as members of the Saskatchewan Roughriders officially cleaned out their stalls and closed the book on the 2024 season.

    • The Regina Rams claimed the Hardy Cup after a hard fought battle against the Saskatoon Huskies 19-14 on Saturday in the first all Saskatchewan U-Sports western conference final since 2002.

    • Emergency crews responded to the scene on Road 68/Highway 2 east of Thamesford around 7 p.m.

    • The events will start at 10:15 a.m. with a parade that forms up in front of the Delta London Armories, marches east on Dundas Street and turns north onto Waterloo Street to Dufferin Avenue, the west to the Cenotaph.

    • A team of tornado experts is heading to Fergus, Ont. after a storm ripped through the area Sunday night.

    • A Barrie man is at the centre of an alleged $2.2 million stolen used car scheme.

    • Environment Canada issued a weather alert for Barrie, Collingwood and surrounding areas, alerting residents about the wicked winds that are expected to pick up to 80 kilometres per hour in the afternoon hours.

    • Barrie residents gathered on Monday to honour Canadaā€™s veterans and pay tribute to those who served and sacrificed for the country.

    • Representatives of the Windsor Veterans Memorial Services Committee, military representatives, wreath bearers, government officials, and members of the public will attend the Cenotaph at City Hall Square for the outdoor service.

    • Windsor Paralympic champion, Danielle Campo, has been crowned the number one Inspirational Speaker of the Year for 2024 at the Inspirational Speaking Finals.

    • One person has been arrested after Chatham-Kent Police Service (CKPS) received multiple complaints about an alleged drunk driver.

    • Environment Canada says heavy rain and winds could cause power outages on Vancouver Island as an "intense" storm system is set to hit the B.C. coast Sunday.

    • Six deer were struck by vehicles in six different locations in a six-hour period on B.C. highways on Saturday, according to the transportation ministry.

    • The union for locked-out port workers in British Columbia says the BC Maritime Employers Association cut off talks in less than an hour Saturday, refusing to budge on a final offer that the union has so far rejected.

    • The emergency department at South Okanagan General Hospital in Oliver, B.C., will be closed for 31 hours this weekend, the second such closure in a week and the third since the start of November.

    • Police in Kamloops, B.C., are reminding parents and guardians to check their children's Halloween candy after receiving a report of a mother finding a razor blade in one of her daughter's treats.

    • More than two years after Alannah Brown and Douglas Barker were found dead north of Penticton, police are asking for help identifying a vehicle they believe was associated with the crime.

    • The Southern Alberta Recreation Association is officially announcing the Town of Taber as next yearā€™s host for the Southern Alberta Summer Games.

    • The Lethbridge Hurricanes broke open a close game with three goals in the first two minutes of the third period as they defeated the Warriors 7-3 in a game played Friday night in Moose Jaw.

    • There might not a lot snow just yet, but many southern Albertans are still itching to get outdoors.

    • It was just days before the COVID-19 pandemic shut the world down when the Shaft Bottom Boys of Sudbury broke a world record for 'Deepest Concert Underground.' Now, more than four years later, a Timmins band is looking to take the title.

    • Police have arrested a 15-year-old in connection with a break-in and $50,000 in damage done to the Centennial Arena in Elliot Lake in September.

    • Mayors of the five largest cities in northern Ontario met in North Bay the last two days to discuss a range of critical issues impacting their cities and the region.

    N.L.

    Shopping Trends

    The Shopping Trends team is independent of the journalists at Ā鶹“«Ć½. We may earn a commission when you use our links to shop.Ā Read about us.

    Stay Connected
    Follow Ā鶹“«Ć½