Food processors and retailers in Canada are in a conflict over fees and surcharges, to the point where some of them say the government will have to get involved.
A panel of food processing companies, some of Canada’s largest grocers, and their respective trade associationshas been having discussionsfor about a year about what some processors say are “abusive” practices by the retailers. They’re complaining about fees and penalties for late or incomplete deliveries, which they say can amount to up to 40% of their sales. This problem reached a head during the pandemic, when many processors struggled to fill orders due to staffing problems.
In a report to the semiannual meeting of Canadian federal, provincial and territorial agriculture ministers, the panel said that it’s at an impasse over surcharges and how to apply them. If it’s unable to agree on any recommendations by November – and it’s already blown past two deadlines – it will ask the government to step in.
That may not be easy. The Canadian federal government has already declared that grocery regulations will have to be left to individual provinces and territories. The industry fears that this will lead to a nightmare scenario of differing regulations across the vast country.