The production costs to grow wheat in Canada fell by 26.5 per cent in 2023, a Nov. 17 news release from Statistics Canada said. Farmers were able to feel some relief from lower input costs.
“The food supply chain consists of many essential steps that move products from producers to consumers. Since March 2022, some costs along the supply chain have been falling, while others have remained high. Prices for bread, pasta and cereal at the grocery store continued to increase in 2023 but at a slower pace than in 2022,” the release said.
The price of pesticides increased by 9.5 per cent year-over-year, fertilizer dropped by 21.1 per cent, fuel for machinery fell 32.8 per cent, while wages for agricultural workers grew by 12.9 per cent.
Food manufactures paid 16.2 per cent less for raw wheat while producer prices for some wheat-based products increased, the release said. The price for bread, rolls and flatbreads rose 10.3 per cent; 0.4 per cent increase for flour mixes, dough and dry pasta; while the price fell 2.7 per cent for breakfast cereal and other cereal products.
Most transportation costs dropped, the release noted. Diesel fuel costs declined by 4.9 per cent and truck transportation costs fell by 7.5 per cent, while rail freight costs for grain and fertilizer increased by 2.3 per cent.
The release noted although prices fell for some inputs, prices for wheat-based food products at the grocery store continued to rise, though at a slower pace year over year.
“Extreme weather events have become more and more frequent and severe over the past few years, impacting global wheat supply and production. Reduced supply amid ongoing demand results in higher prices for consumers,” the release said.
With both Russia and Ukraine being major wheat producers, the ongoing conflict between the two continues to create uncertainty in the global wheat market, the release noted.