If you thought $37 chicken breasts were unfairly expensive, just wait until we remind you about what happened to the price of bread.
Driving the news: One of Canada’s biggest bread producers, Canada Bread, plead guilty to a years-long price inflation scheme unveiled by the Competition Bureau. The firm is on the hook for a $50 million fine—the highest price-fixing fine ever imposed by a Canadian court.
- The company admitted its previous management conspired with Weston Foods, a competitor, to inflate the wholesale prices of bread, which raised the sticker prices.
- Canada Bread, which makes dozens of brands of baked goods like Dempster's, Stonemill, Vachon and others, coordinated to raise prices in both 2007 and 2011.
Catch up: If “grocers fixing bread prices” sounds like a familiar headline to you, it's because Weston-owned Loblaws fessed up to its part in the scheme in 2015. Per the bureau's math, various players baked an extra $1.50 into the retail price of bread over at least 16 years.
- The company avoided prosecution by cooperating with the bureau and attempted to make amends by offering customers $25 gift cards.
Why it matters: Think of the fine as a warning for the grocery sector. With grocery inflation hitting 8.9% in June and an inquiry into the pricing practices of the country's top grocers underway, the crackdown on price fixing is likely a welcome development for consumers.
Bottom line: Canadian grocery scandals have run rampant because of a lack of competition in the sector, a problem that the Competition Bureau and feds are working to solve.—LA