Rising produce prices result of falling loonie

The cost ofbuying fresh producewill continue to eat up more of your family's food budget, according to researchers at the University of Guelph.

By year's end vegetable prices may increase between 5.5 and 7.5 per cent, according to projections by professors at the University of Guelph.

In December, researchers warned of slight increases but the plummetingloonieforced them to revise their findings in February.

The loonie's descentis affecting the price of food imports, particularly producesaidSylvainCharlebois, a professor at the University of Guelph who specializes in food distribution policy.

"2015 was going to be the year of the Canadian loonie weakening against the American dollar. We were expecting the drop to happen," he said. "But the loonie's descent was so rapid, it was difficult for anyone to hedge against it and Canadian food importers were expected to pay more."

Theloonieis trading at 78 cents to the American dollar, a decrease of 10 cents since March 2014, according to the Bank of Canada.

Local businesses feeling the pinch

In January, the price of celery increased 11 per cent,and mushrooms and carrots both increased by fiveper cent over January 2014, according to Statistics Canada.

Jack DaGraca, the co-owner of Windsor's Lumberjack restaurant said he's noticed prices have gone up fiveto20 per cent on certain items.The price for a head of green leaf lettuce is $26.50, up from $23 last week.

WhileLumberjackhasn't passed the increase onto consumers,many small restaurants and grocery stores won't have that luxury.

"Two weeks ago, cauliflower used to be $12 a case in U.S dollars, today we paid $40 acase, making it almost $5 dollars a head," said Tony Sorge, owner of Silverstein's Produce.His consumers used to be able to buy twoheads for $3.

"In two weeks, [the price] has gone up at least four times," he said.

Charlebois said businesses try to keep prices steady. But this time he saidthere's no way to avoid raising prices..

"These increases are quite significant, and I'm not surprised restaurant owners would [raise prices]," Charlebois said. "You can't revenue manage your way out of this."

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