‘Expect very high grocery prices,’ farmer warns as diesel costs rise

Farmers around the world are feeling the pain of the Iran war. Gas prices have risen and fertilizer supplies are dwindling due to Tehran’s closure of the Strait of Hormuz in retaliation for US and Israeli bombing.

Iran is severely limiting shipping through the Strait of Hormuz, a narrow strait that normally carries about a fifth of the world’s exports and about a third of the world’s fertilizer trade.

Canadian farmers are also grappling with higher costs, and consumers are being warned they could soon feel the impact at the exits.

In an interview with CTV News Channel, family farmer, lawyer and 33SEVEN founder Derryn Shrosbree said rising input costs are already affecting producers, and diesel stands out as the most immediate concern.

“Farmers use a ton of diesel and obviously a lot of fertilizer as inputs,” Shrosbree said.

“Now what we see is that, there are many materials that increase the price, so dry nitrogen, urea, phosphates and sulfur and other chemicals that we need for agriculture.”

While fertilizer costs have a long-term effect on food prices, Shrosbree says rising diesel prices can have an immediate and significant impact.

He said: “What will increase the price of food is diesel. “So diesel has doubled this year.”

That increase affects the entire supply chain, from manufacturing to transportation, he added.

‘Expect record high grocery prices in September’

“If diesel prices stay high, expect your grocery bill to go up 25 to 50 percent,” Shrosbree said.

“So that’s going to be a very difficult situation for a lot of Canadians, you know, to feed their families.”

Although many farmers have enough fuel and fertilizer stored to get crops this season, he said the real challenge will come later in the year during harvest.

“If this continues for the harvest, the harvest will be very bad because the harvesters use a lot of diesel, and if the price of diesel doubles, we will be completely destroyed,” Shrosbree said.

He added that those high costs will eventually be passed on to consumers.

“If we don’t get relief from the government or any kind of assistance there, expect very high grocery prices in September,” he said. “So on Labor Day, you know, if, if the shenanigans continue, we’re going to be in a tricky situation.”

The pressure is already being felt on farms

Shrosbree, who grows mushrooms and vegetables in southwestern Ontario and delivers to restaurants in Toronto, says his transportation costs have gone up.

“My diesel bill for my truck has doubled,” he said. “So where does that expense go?”

He said farmers have little ability to pass on the increase to consumers.

“I can’t push my price on my customer, because that’s a lot of money that people can pay for their dinner in restaurants,” he said. “So what’s to give?”

Without more support, he warned, the situation could deteriorate rapidly.

“If diesel prices don’t come down within 3 months, I think there will be some tough negotiations ahead of us,” Shrosbree said.

The federal government has taken other relief measures, including increasing the limits of farm support programs, he said.

“Thankfully they have increased the program’s contribution limit to 500,000 for charity,” Shrosbree said.

However, he suggested that more urgent measures, especially on fuel costs, could make a difference.

“If they can help at the pump, that would be great, because obviously there is a gas tax, which is very high,” he said. “If they were to lower the gas tax, that would not only help the truckers and all the good people, but the farmers would be directly affected.”

In files from the Associated Press