Loblaw warning Canadians that grocery prices are about to skyrocket

We hate to be the bearer of bad news, but grocery prices are expected to continue rising in Canada amid U.S. President Donald Trump's tariffs, according to the latest report by Loblaw Companies Limited.

The retailer, which owns numerous major grocery chains, including Loblaws, No Frills, and Real Canadian Superstore, released its May food inflation report on Tuesday, May 27.

In the report, Loblaw said that thousands of everyday items are set to rise in price. While this isn't the best news for Canadians trying to reduce their grocery bill, the grocery giant did add that it could have been a lot worse.

Recently, the Government of Canada introduced a six-month reprieve on tariffs on certain U.S. imports used in Canadian food manufacturing and packaging. Loblaw stated that this, in addition to the recent stabilization of the Canadian dollar, has helped mitigate the risk of a sharp or prolonged spike in food inflation.

"The Government's announcement exempts 'indirect tariffs' for products from the U.S. that are used in the manufacturing of final goods here in Canada," said Loblaw.

"Indirect tariffs were of significant concern for food prices, given the widespread use of imported ingredients — such as chocolate chips or peanuts — in Made in Canada products. With this change, only final products imported from the U.S. are now subject to tariffs, providing relief on a significant number of products on shelf."

That being said, thousands of different items continue to have tariffs applied, including food products imported from the U.S., such as produce, rice, pasta, dairy, and coffee, as well as health and wellness products like soap, shampoo, and cosmetics.

"In a conventional grocery store, there can be upwards of 80,000 items, and consumers can expect tariff-related increases on approximately 6,000, about half of which are food," added Loblaw.

However, the company did add that most products with tariffs also have a non-U.S. alternative available.

"In order to minimize the impact of these tariffs, grocers are sourcing from new countries and are helping customers make more informed choices through labelling. In addition, manufacturers are looking for ways to keep prices down for customers, including by shifting supply chains to bypass the U.S.," said Loblaw.

Previously, when the trade war between Canada and the U.S. began in March, the grocery giant warned shoppers that they would not see an immediate impact on food prices.

Additionally, in last month's report, Loblaw said, "While the impact of Canada's counter tariffs was minimal on food prices in March, as retailers sell through existing inventories, higher prices will begin appearing on shelves."

Earlier in May, Loblaw CEO, Per Bank, shared a post on LinkedIn forecasting what store aisles will look like in the next few months as the trade war between Canada and the United States continues.

"While the tariff situation might be improving between the U.S. and other countries, that's not yet the case here in Canada. In fact, we'll be facing a large wave of tariff-related increases in the weeks ahead," wrote Bank.