Federal Industry Minister courts new players for Canadian grocery market

Industry Minister François-Philippe Champagne insists once again that he is reaching out to international merchants in the hope that they will open stores in Canada. and stimulate more competition.

Champagne said Tuesday that he had spoken to a foreign grocer earlier that morning as part of his efforts to attract new players to the Canadian grocery sector, but did not mention any names.

“I can’t tell you much, or you won’t ask me questions next week,” he said in French before the weekly cabinet meeting.

“I spoke to a company this morning.”

As food inflation continues, Champagne has repeatedly mocked in recent months conversations it says it has been having with foreign grocers.

Canada needs more competition for grocery dollars, and having more players in the market would help put downward pressure on prices, he said.

“Will I succeed? I don’t know. But it’s certainly worth a try.”

The focus on attracting international grocers comes after Champagne’s largely futile attempt to pressure Canadian grocers to help control grocery prices.

He met with Canadian grocers in the fall and demanded they create plans to stabilize grocery prices or face the consequences, including possible tax measures.

@FP_Champagne says he is working with phones to attract new players to the Canadian grocery market. #CDNPoli #FoodPrices #GroceryPrices #Canadian Stores #inflation

But beyond expressing disappointment that grocers have not been more transparent, Champagne has not said whether the federal government plans to punish them for it.

“To date, large supermarkets have not been sufficiently transparent about the causes of food inflation and, for the most part, have not provided regular updates on initiatives aimed at stabilizing food prices in the country,” he wrote in a letter on Monday. according to Matthew Boswell, Canada’s competition commissioner.

“Continued record profits in the grocery retail sector indicate there are more opportunities to provide relief to Canadian consumers.”

Metro Inc. on Tuesday reported a first-quarter profit of $228.5 million, with sales up 6.5 percent. In a virtual news conference, CEO Eric La Flèche said retail price increases will begin arriving at grocery stores next week, as an industry-wide blackout period on price increases comes to an end. of the suppliers.

La Flèche has stated that Metro did not change its prices after the meeting with Champagne.

Champagne’s letter to Boswell suggested a follow-up study of the food sector now that the office has new powers to subpoena companies for information.

“I was disappointed to learn that the office’s study did not have the full cooperation of the large grocers,” the letter said.

“I also look forward to discussing your assessment of the potential scope and feasibility of a grocery market monitoring study.”

Metro cooperated fully with the previous study, La Flèche insisted on Tuesday.

The Competition Bureau published the results of its study in June, stating that shopkeepers’ cooperation was inconsistent and insufficiently comprehensive.

The report found that concentration in the grocery industry has increased in recent years, and the largest grocers have increased their profits from food sales.

The bureau also said Canada’s grocery sector needs more competition to help keep food prices low, give shoppers more choice and encourage new entrants.

On Tuesday, a spokesperson for the office confirmed it had received the minister’s letter and was considering it.

“We are committed to promoting more choice and more affordable foods for Canadians through greater scrutiny of the grocery industry and a thorough and prompt investigation of allegations of wrongdoing,” said Marcus Callaghan.

“The office is also committed to using the new tools available through recent amendments to the Competition Law whenever necessary to protect competition.”

The Liberal government recently made several changes to the country’s competition law, including giving the office the power to demand information from companies for a market study.

The changes also allow the office to pursue anticompetitive collaborations between companies, even if they are not competitors.

Champagne said this will help boost competition in the grocery sector, as it will allow the office to challenge lease agreements that prevent competitors from opening nearby stores.

This report by The Canadian Press was first published Jan. 30, 2024.

— With files from Rosa Saba in Toronto.

Leave a Comment