News Briefs

OTTAWA - The annual inflation rate skyrocketed to its highest level in nearly 40 years in May, fuelled by soaring gas prices, Statistics Canada said Wednesday.

The agency said its consumer price index in May rose 7.7% compared with a year ago, its largest increase since January 1983 when it gained 8.2% and up from a 6.8% increase in April this year.

The gain came as energy prices rose 34.8% compared with a year ago with gasoline prices up 48.0% compared with a year ago.

Statistics Canada said crude oil prices rose in May due to the ongoing war in Ukraine, as well as increased demand as travel continued to grow in response to eased COVID-19 restrictions.

Excluding gasoline, the annual inflation rate in May rose to 6.3% compared with 5.8% in April.

The rising inflation rate comes as the Bank of Canada works to bring it back under control.

The average of the three core measures of inflation that are closely watched by the Bank of Canada rose to 4.73% in May compared with 4.43% in April.

The central bank has raised its key interest rate target three times so far this year to bring it to 1.5% and said that it is prepared to "act more forcefully'' if needed, leading to speculation by economists that it could raise rates by three-quarters of a percentage point next month.

The U.S. Federal Reserve raised its key rate by three-quarters of a percentage point last week after the inflation report for May in the U.S. showed prices up 8.6% from a year ago.

TD Bank managing director Leslie Preston said a generation of Canadians is experiencing high inflation for the first time.

"If you aren't over 40, you have never lived through inflation like this, and unfortunately, we are not expecting much of a reprieve going forward,'' Preston wrote in a report. "All of this reinforces the view that the Bank of Canada will hike by 75 basis points on July 13, following in the Fed's footsteps.''

Statistics Canada said the price for food bought at stores rose 9.7% compared with a year ago, matching the April increase, as the cost of nearly everything in the grocery cart went higher.

The cost of edible fats and oils gained 30.0% compared with a year ago, its largest increase on record, mainly driven by higher prices for cooking oils. Fresh vegetable prices rose 10.3%.

The cost of services in May rose 5.2% compared with a year ago, up from a gain of 4.6% in April, as Canadians travelled and ate in restaurants more often.

Prices for traveller accommodation gained 40.2% compared with a year ago, while the price of food purchased from restaurants gained 6.8%.

-The Canadian Press

TORONTO - Loblaw Cos. Ltd. and food delivery company DoorDash Inc. today announced a collaboration that introduces a rapid grocery delivery service to customers in Canada.

Starting in August, customers in some Canadian cities, including Toronto, Vancouver and Calgary, will be able to order select items from Loblaw for delivery in 30 minutes or less.

The items can be ordered by selecting PC Express rapid delivery through the DoorDash app.

Starting in July, customers will also be able to order items from all Loblaw banner stores, including Loblaws, Real Canadian Superstore and Shoppers Drug Mart, for delivery through DoorDash.

Loblaw already has a grocery delivery partnership with Instacart.

The agreement comes as DoorDash's share price on the New York Stock Exchange has tumbled more than 60 per cent from its November high.

Financial terms of the partnership were not disclosed.

-The Canadian Press

7-Eleven in the U.S. is diversifying its delivery options by teaming up with Waitr Holdings Inc., an on-demand food ordering and delivery service. The new collaboration provides a fresh delivery option for customers across more than 700 7-Eleven locations.

“We’re excited to reach and serve our customers on Waitr with what they want – when, where and how they want it,” said 7-Eleven SVP and chief digital officer Raghu Mahadevan. “We look forward to bringing fan-favourite 7-Eleven products – like ice cold Slurpee drinks, hot pizza or ice cream– to even more customers across the country.”

Waitr operates in more than 1,000 cities in the United States and has 26,000-plus restaurants on its platform. 

“The addition of 7-Eleven to our platform represents the newest example of our ongoing commitment to expand into new delivery verticals,” said Carl Grimstad, CEO and chairman of the board of Waitr. “This partnership creates a new level of convenience for our customers. Effective immediately, we will be able to deliver your favourite food and snacks from hundreds of 7-Eleven locations directly to you.”

The new partnership builds on 7-Eleven's current delivery portfolio in the U.S., which includes Uber Eats, Grubhub, Instacart, Postmates and DoorDash, as well as Google Food Ordering and Favor in select markets.

Of course, 7-Eleven also offers delivery via its propriety 7NOW mobile app. The Gold Pass launched earlier this year.  

 

Kellogg Co., the maker of Frosted Flakes, Rice Krispies and Eggo, will split into three companies focused on cereals, snacks and plant-based foods.

Kellogg's which also owns and MorningStar Farms, the plant-based food maker, said Tuesday that the spinoff of the yet to be named cereal and plant-based foods companies should be completed by the end of next year.

The company's corporate headquarters will move from Battle Creek, Michigan, to Chicago, but it will maintain dual headquarters in both cities for its snack company, which makes up about 80% of current sales. Kellogg's three international headquarters in Europe, Latin America, and AMEA will remain in their current locations.

Companies have begun to split up at an accelerated pace, including General Electric, IBM and Johnson & Johnson, but such splits are more rare for food producers. The last major split in the sector was in in 2012, when Kraft split to create Mondelēz.

- The Associated Press

BRAMPTON, Ont. - Loblaw Companies Ltd. says it plans to eliminate all single-use plastic shopping bags from its stores by the end of the first quarter of 2023.

The parent company of Loblaws and Shoppers Drug Mart says the move will apply to its corporate and franchise grocery stores, pharmacies and PC Express service.

It has 2,500 stores across the country.

Loblaw says as single-use plastic shopping bags are phased out systematically, province by province, customers will be have a variety of reusable alternatives.

It says customers have already rallied around reusable bags.

Loblaw says the adoption of a plastic bag fee has led to a 70% decline in the use of plastic bags in its stores.

- The Canadian Press

TORONTO - Grocery giant Empire Company Ltd. is moving forward with a new loyalty program after becoming a co-owner of the Scene+ program operated by Cineplex Inc. and Scotiabank.

The three parties announced the new partnership on Tuesday. The theatre operator and bank said the addition will allow Scene+ members to earn and redeem points at the majority of the grocer's supermarkets, including Sobeys, Safeway, Foodland, IGA, FreshCo, Needs, Thrifty Foods, Les Marches Tradition, Rachelle Bery and Lawtons Drugs

Scene+ allows cardholders to rack up points when purchasing movie tickets from Cineplex, meals from Recipe Unlimited Corp. restaurants including Swiss Chalet and Harvey's and when banking with Scotiabank. The points can be redeemed for purchases made with these businesses and others.

The deal could make the program more lucrative because it broadens the roster of retailers Scene+ can be used at and exposes all of the owners to Empire's customers, a consumer base that makes frequent shopping trips.

"We have three great Canadian brands, and we feel with the Scene+ loyalty program, we will basically improve the reach of all of our members, with the addition of groceries and all of the other things we have,'' said Ellis Jacob, Cineplex's chief executive. "To me, it's a really a big win for Canadian consumers and a big win for our program as we move forward.''

Jacquelin Weatherbee, Empire's vice-president of communications and corporate affairs,said the grocery chain did not have to pay for its co-owner status because of "the opportunity'' it brought to all of the partners.

Asked whether ownership was structured at 33.33% each, Dan Rees, Scotiabank's group head of Canadian banking said "we are all equal partners.''

He added that millions of Canadians enjoy Cineplex's entertainment every year. Scotiabank and its Tangerine brand have 10 million customers, Empire has roughly 10 million and Scene+ has about 11 million members.

The Scene+ rollout at Empire's chains and through its Voila delivery service will start in Atlantic Canada in 2022, and by early 2023 will be launched in supermarkets across the country.

However, the program will not be available at its Farm Boy or Longo's stores.

"We're always looking at new opportunities to help evolve and expand (the) offering, so they aren't a part of the current rollout plan, but we'll make some considerations for the future,'' said Weatherbee.

At a later undisclosed date, Scene+ will be accepted at Empire's network of liquor stores in Western Canada.

Competitor Loblaw Companies Ltd. has long operated its own loyalty program that can be used at its grocery stores and pharmacies, while Metro Inc. has its own program in Quebec, uses Air Miles in Ontario and Thunder Bucks in Thunder Bay.

Empire has long relied on Air Miles, which it will now phase out.

Shoppers will be able to earn Air Miles until the Scene+ program is launched in their region.

Empire had "a lot of suitors,'' when it started exploring a loyalty program, but Weatherbee said it opted for Scene+ because it was a program customers were "overwhelmingly'' interested in.

Weatherbee said the consumer profile is changing and they want loyalty programs that are diverse.

"They want choice on when, where and how they can earn and redeem and solo propriety programs jut don't offer that experience.''

Scene+ was originally created by Cineplex and Scotiabank in 2007, but relaunched in 2021 with a slew of new partners and benefits for cardholders.

- The Canadian Press