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Oil and gas corporations contribute to high grocery prices too

Hundreds of thousands of Canadians have been boycotting Loblaws since the beginning of May, with a recent poll putting the number at nearly one out of five people in the country. The #BoycottLoblaws movement has united people around their shared anger at grocery prices and highlighted the need for policies that rein in corporate power and greed. 

With the soaring cost of living now squarely at the centre of public debate, it’s worth looking at other factors influencing this crisis. The power held by the big five grocery companies is a major factor in how much we’re spending on necessities – but other factors, like the climate crisis and the dependence of our food systems on oil and gas products are predicted to drive up food prices even higher over the next 15 years and beyond.

The affordability crisis and the climate crisis are intimately linked – and our decision-makers are still not holding the corporations that are to blame accountable. Instead, they are letting Big Grocers and Big Oil call the shots, even as they try to ride the wave of people’s anti-corporate anger.

Conservative Party leader Pierre Poilievre, for example, portrays himself as a friend of the working class while his top advisor runs a firm that has lobbied on behalf of Loblaws. These corporate ties seriously call into question his willingness to face down the grocery giant on behalf of the people he claims to represent. 

Ultimately, it’s up to us and our social movements to build the power necessary to remind our governments who they were elected to represent, and to ensure that the fundamental right to food is being prioritized over the interests of private companies and interests.

How are climate change and fossil fuel dependence affecting grocery prices?

The cycles of fossil fuel dependence and climate change have complex impacts on grocery prices. Our food system is deeply dependent on fossil fuels – from the fertilizers that farmers are increasingly using that are manufactured with natural gas, to the processing and plastic packaging used for our foods. As such, food production is a major carbon emitter, and with fossil fuel companies increasingly investing in the petrochemicals used for fertilizers and food processing, our food systems are being locked further into fossil fuel dependence.

Fossil fuel dependence means that food prices are directly tied to the volatility of oil and gas markets. We saw this in 2023 when OPEC limited oil production, and we are increasingly seeing the the impact of extreme weather like heat waves and tornadoes on the refinement and distribution of fuel. These factors contribute to the rising cost of gasoline, which impacts the cost of growing and transporting food – and the eventual price of food in grocery stores. 

The dependence of our food systems on fossil fuels is also contributing to the severity of the climate crisis, which in turn impacts the growth and transportation of food, with extreme climate events like droughts, floods, and wildfires becoming more and more common. With 81% of Canada’s agricultural land experiencing abnormal dryness or moderate-to-severe drought conditions, droughts are increasingly impacting the production of key crops like wheat, canola, and barley. As droughts stretch on, soil erosion is increasing, leading to the loss of valuable nutrients and topsoil necessary for good yields. These impacts, both at home and abroad, drive up the cost of producing food. This also drives up costs for taxpayers and governments as farmers increasingly seek out crop insurance payouts to help cover production losses in the event of natural hazards.

It’s important to note that even when farmers can get their crops to market, they aren’t the ones responsible for most of the significant price hikes we’re seeing in grocery stores. According to the National Farmers Union (NFU), which has been advocating for farmers and our food system for decades, the corporate concentration of the food sector means that processors and retailers can increase prices for consumers without more money reaching farmers, despite farmers feeling the brunt of growing climate breakdown and rising prices. 

We’re also seeing impacts on how food gets to consumers, with wildfires and floods obstructing key transportation passages, affecting the access that we have to food in grocery stores. People in Chilliwack, Hope, and communities across the Okanagan in BC experienced this firsthand in 2021, when flooding impacted both producers and the transportation of groceries in the province, leading to empty shelves and panic-buying. The B.C. Trucking Association noted that the additional cost of finding alternative routes would be paid for by consumers

The self-perpetuating cycle of fossil fuel dependence and the impact of the climate crisis on our food systems is bad for the planet, bad for us at the grocery store, and bad for farmers and farm workers. 

If not farmers and families, who is the government listening to?

Rather than bold policies that support farmers and families feeling the impacts of the climate and affordability crises, the federal government has been prioritizing the interests of the powerful oil and gas sectors. 

For years, these giants have been shaping policies that keep us and our food systems reliant on increasingly destructive and expensive fossil fuels.

In 2012, the Harper government introduced an omnibus bill that allowed cabinet to give the go-ahead to pipelines and other energy projects; changed the Fisheries Act and the Species at Risk Act to make it easier for oil and gas projects to get regulatory approval; and scrapped the Kyoto Protocol Implementation Act, our commitment to curb greenhouse gas emissions at that point. These sweeping changes also removed accountability to Indigenous communities and other communities that weren’t considered “directly impacted.” 

The fingerprints of the Canadian Association of Petroleum Producers (CAPP) were all over that omnibus bill – oil and gas industry groups had previously requested changes to environmental laws, and the parliamentary secretary for Environment Canada was directed to seek support from a major tar sands company before the tabling of the bill.

More recently, in the 2024 federal budget, CAPP demonstrated its outsized power, again, by blocking a federal windfall tax on oil and gas profits. And while environmental protections and regulations have improved somewhat under the current Liberal government, the impact of the oil and gas lobby is still evident in the enormous federal subsidies provided to the industry every year, and the slow pace and limited investment in a national transition away from fossil fuel. 

To ensure the health of our food system, which is entangled in the climate crisis, the government should be stepping up to accelerate our transition away from fossil fuels. Instead, the federal government has been letting the oil and gas industry call the shots – stalling the transition away from fossil fuels and locking us into food prices that are dictated, in part, by the very industry responsible for the climate crisis.

Worsening crises call for building community power

Our governments and decision-makers have been captured by corporate power – this is very clear in the power that the grocery and oil and gas industries currently have in writing or blocking policies that are meant to regulate them, in the increasing prices of groceries for us, and in the growing costs for farmers who are producing our food. 

What are our options? After deciding to continue the movement, the organizers of #BoycottLoblaws are now turning their attention to broader advocacy to make groceries more affordable for all of us. The power they’ve built to this point can now be leveraged to push back against the power of Big Grocers and all corporate giants. We have an opportunity to continue to put pressure on our decision-makers to remember who they were elected to represent – us, not corporations. 

The Council of Canadians has been working for almost 40 years to push back against the slow takeover of our public institutions by corporate interests. Join our movement and support the work to reclaim our public institutions for the people across this country that they are supposed to serve.