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Canadian restaurateurs grapple with rising food costs, menu prices expected to rise

Restaurants are a low margin industry, so thereB次元官网网址檚 not a lot of room to work in additional costs
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Blair Lebsack, owner of RGE RD restaurant, poses for a portrait in the dining room, in Edmonton, Friday, June 18, 2021. Canadian restaurants are having to find ways to deal with the rising cost of food. THE CANADIAN PRESS/Jason Franson

Restaurants across the country have been grappling with rising food prices since the start of the COVID-19 pandemic, but for Blair Lebsack, some of the most shocking increases have been for his restaurantB次元官网网址檚 less flashy ingredients.

Before the pandemic, a 16-litre container of canola oil for his Edmonton restaurant RGE RD would cost $18, he said. Now they go for anywhere between $29 to $32 for the same amount.

B次元官网网址淚t adds up really quickly,B次元官网网址 Lebsack said in an interview.

High shipping rates, delays and increases in grain costs have sent food prices soaring for restaurants already hurt by pandemic restrictions and closures.

Restaurants CanadaB次元官网网址檚 James Rilett said restaurants are a low margin industry, so thereB次元官网网址檚 not a lot of room to work in additional costs.

B次元官网网址淚tB次元官网网址檚 pretty bad. We wonB次元官网网址檛 have an idea of how bad until most provinces get reopened,B次元官网网址 Rilett said.

A survey by Restaurants Canada found food costs are one of the top three challenges restaurants are facing along with additional shutdowns and pandemic-related debt.

Rilett, Central Canada vice-president at Restaurants Canada, said while most restaurant owners will try to delay menu increases for as long as possible, he expects customers will face higher prices.

The pandemicB次元官网网址檚 effects on food prices have been far-reaching, impacting the entire supply chain, according to CanadaB次元官网网址檚 Food Price Report.

B次元官网网址淚 think last year when the pandemic hit, the food industry was somewhat protecting the consumer. Prices did go up last year but (the industry) did absorb some of the shock created by the pandemic,B次元官网网址 said Sylvain Charlebois, lead author of the report and director of the Agri-Food Analytics Lab at Dalhousie University.

However, the food price report predicts thereB次元官网网址檒l be a five per cent increase in prices this year, up from a three per cent increase in 2020, he added.

B次元官网网址淪ome people may say B次元官网网址榃ell, itB次元官网网址檚 five per cent, whatB次元官网网址檚 the big deal?B次元官网网址橞次元官网网址 he said. B次元官网网址淏ut five per cent is quite significant because food inflation is not a game of averages.B次元官网网址

According to monthly average retail price data from Statistics Canada, between January 2020 to May 2021, the average price of a kilogram prime rib roast went up almost 12 per cent. The price of 200 grams of instant coffee rose nearly 15 per cent.

Charlebois also noted that shipping costs have had a significant impact on CanadaB次元官网网址檚 food prices and have tripled in the last year. And like Rilett, he expects restaurants will raise their prices to make up for the increased costs and may even make cuts to their menus to reduce the amount spent on food.

Menu changes have been LebsackB次元官网网址檚 approach so far.

RGE RD has been open for indoor dining for just over a week and while his regulars have noticed the higher costs, he said theyB次元官网网址檝e also been understanding.

B次元官网网址淲e have really good dialogue with our customers,B次元官网网址 Lebsack said.

Lee Cooper, chef and owner of LB次元官网网址橝battoir in Vancouver, said heB次元官网网址檚 also feeling the squeeze of increased costs.

The upscale eatery, however has a clientele that is used to spending a bit more on their dining experiences, Cooper added, which has helped the transition to changes in the menu.

B次元官网网址淥ur restaurant is not super cheap and we try our best to offer a premium product so I think our guests come in ready to spend a little bit more,B次元官网网址 Cooper said.

One way for restaurants to lessen the blow of higher costs has been to get supplies from local sources.

Lebsack said he has about two years worth of animals being bred for RGE RD by local farms which are helping the restaurant avoid industrial farming prices.

B次元官网网址淭he closer we can work with our food and our neighbours, our community, the tighter we can keep our costs.B次元官网网址 Lebsack said.

And the saving grace for the countryB次元官网网址檚 restaurants may be the pent-up demand as diners head out for the first time after months of cooking at home and takeout meals.

Lebsack said heB次元官网网址檚 already seeing his customers excited to get back to the brick-and-mortar dining experience.

B次元官网网址淭he only really good thing coming out of this is how much people have missed restaurants,B次元官网网址 Lebsack said.

B次元官网网址淚 think once people digest that everything has gone up in price, I think theyB次元官网网址檒l be coming back out again and making it worthwhile for us to be in business.B次元官网网址

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This story was produced with the financial assistance of the Facebook and Canadian Press B次元官网网址 Fellowship.

Danielle Edwards, The Canadian Press


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