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From Free Food Fridges to Loblaws Explanation of Rising Prices (2 articles)

Article 1: Free Food Fridges Take Off In Parts Of Europe In Eco-Friendly Bid To Fight Waste

FREE-GO SAYS ABOUT 1 BILLION TONS OF FOOD GO TO WASTE EVERY YEAR AROUND THE WORLD

Courtesy of Barrie 360 and Canadian PressPublished: Jul 28th, 2023

By Jamey Keaten in Geneva – The Associated Press

That head of lettuce you forgot to make a salad with starting to wilt? Did you buy too much bread before heading out for a holiday?

In an effort to help eco-conscious consumers, a Geneva nonprofit is ramping up its rollout of street-side, free-access public refrigerators that restaurateurs, at-home cooks and others can use to give away food that’s about to go bad. It’s part of a bigger effort by communities in Switzerland and other European countries to do their part for the environment while helping to cut down on food waste.

The nonprofit Free-Go — whose name riffs off the word “frigo,” a colloquial French word for refrigerator — has rolled out refrigerators and pantry shelves in Geneva where passersby can grab fruit, vegetables, bread, croissants and other perishables to take home for free.

The program costs about $40,000 to run each year and enjoys the support from both charity groups and the city government. It launched a year ago with a single fridge outside a community center in western Geneva and it now has four fridges, strategically placed around town. A fifth one is planned before year’s end.

Marine Delevaux, the project’s director, says the deposited food is generally snapped up within an hour after delivery. For health and regulatory reasons, no frozen foods, open food containers, prepared meals or alcohol are allowed in the fridges.

Free-Go is also experimenting with scheduled pickups at apartment buildings to make it easier for residents to participate in the program. It has also set up a “hotline” that restaurateurs can use to call for retrieval of unused food.

“Generally, when the food collected from shops and restaurants arrives in the morning, people are already waiting to help themselves,” Delevaux said, adding that the first Geneva fridge helped save some 3.2 tons of food from going to waste last year. Of the food donated, only about 3% had to be thrown away because nobody wanted it.

Free-Go says contributors of food from the private sector — such as restaurants or food vendors — must make a commitment to ensure the donated food is safe to eat. Swiss law says food past the “recommended use-by date” can be consumed for up to a year afterwards, Delevaux said.

The Swiss government estimates that nearly one-third of all food products destined for consumption is wasted or thrown away needlessly — amounting to about 330 kilograms (about 730 pounds) of food waste per inhabitant each year. Of that, about 100 kilograms (about 220 pounds) are attributed to waste by households.

Free-Go says about 1 billion tons of food go to waste every year around the world — using up energy and other resources in the farming and transportation process.

“Wasting food is not only an ethical and economic issue but it also depletes the environment of limited natural resources,” the EU’s Commission says.

Similar food-sharing campaigns are in place in the capital, Bern, and in western Neuchatel, after the idea was imported from Germany.

According to Foodsharing.de, a community group in Germany that started more than a decade ago, more than a half-million people in Germany, Switzerland and Austria have made “the food-sharing initiative an international movement” and have helped save 83 million tons of food from going to waste.

Because the food is free, and the donations can vary, it’s uncertain what will turn up in the fridges — and some recipients might end up being disappointed.

Outside a community-center in a working-class area of Geneva on Friday, Shala Moradi, a 65-year-old housewife from Iran who has lived in Geneva for a decade, said she had been looking for some bread — and there was none. Yet, she says she appreciates the initiative.

“It’s very good. I can take strawberries, cherries, things like that,” she said. “The free (part): I like that too.”

Fresh off depositing some tomatoes from her vegetable garden, Severine Cuendet, a 54-year-old teacher, said “we have too much” and applauded the initiative “because this neighborhood has a lot of need.”

“And it happens to all of us to buy too much,” she added with a smile.

Geir Moulson and Kirsten Grieshaber contributed from Berlin.

Article 2: Loblaws Says Big Global Brands Drove Prices Higher In 2nd Quarter

PROFITS WERE HIGHER DESPITE LOWER GROSS MARGINS

Courtesy of Barrie360.com and Canadian PressPublished: Jul 27th, 2023

Large global suppliers are driving costs higher for Loblaw Companies Ltd., the firm said as it released earnings for the second quarter that showed profits up despite lower gross margins.

“We have received double−digit increases from the same suppliers who gave us double−digit increases last year. That’s why you see products that are noticeably more expensive than they were just a couple of years ago,” said CFO Richard Dufresne on a conference call with analysts. 

“While cost increases are coming in from all tiers of our supplier base, the largest global brands stand out.”  

One of the company’s largest vendors submitted price increases totalling 50 per cent, or a quarter−billion dollars, said Dufresne. He added that prices for meat, fruit and vegetables rose in the mid−single−digits while centre−of−store prices were up in the double−digits. 

“The math is very simple: Cost increases from big brands were well above Canada’s food inflation, and our food margin declined,” said Dufresne. “Suggestions of grocer profiteering just don’t add up.”

Canada’s grocery giants, the largest of them being Loblaw, have been under increased scrutiny amid breakneck inflation that’s especially hit food prices. While overall inflation has been moderating, most recently to 2.8 per cent in June, grocery prices have continued to grow, up 9.1 per cent last month. 

Politicians have called for the grocery industry to be more transparent about what has been driving profits, which have outperformed amid a broader rise in corporate profits. 

Last month, the Competition Bureau released a study saying Canada’s grocery industry needs more competition to keep food prices down. 

The largest grocers have increased the amount they make on food sales in recent years, the bureau said, with the three biggest grocers collectively reporting around $3.6 billion in profits last year. Food gross margins increased by a “modest yet meaningful” amount of one to two percentage points over the last five years, the study found.

On Wednesday, Loblaw reported a profit available to common shareholders of $508 million for its second quarter ended June 17, an increase of 31.3 per cent from the same period last year.

Net earnings were “unusually elevated” because of a prior−year charge at President’s Choice Bank, Loblaw said in a press release, noting that adjusted net earnings were up 10.6 per cent. 

The parent company of Loblaws and Shoppers Drug Mart reported its profit amounted to $1.58 per diluted share for the quarter ended June 17, an increase from $1.16 per diluted share in the same quarter last year.

Revenue for the 12−week period totalled $13.7 billion, up from $12.8 billion a year earlier.

Food retail same-store sales were up 6.1 per cent, while drug retail same−store sales increased by 5.7 per cent.

Food retail sales growth was driven by a continued consumer shift to discount stores and interest in private−label brands, the company said.

Hard discount banners continued to outperform the overall discount channel, said Dufresne, adding that the company’s discount position in Quebec grew in the second quarter with 10 Provigo stores converted to the Maxi banner, and another 10 conversions planned in the third quarter. 

However, it added that retail gross margin declined slightly in both the food and drug categories, saying it faced double−digit supplier cost increases that were not fully passed on to consumers. 

Loblaw’s teams are reaching out to suppliers and pressing for cost decreases, said Dufresne. 

The negotiations between grocers and suppliers, normally out of the limelight, have been in sharper focus amid high food inflation. Last spring, the absence of Frito−Lay products in Loblaw−owned stores made a pricing dispute public as the two companies faced off before eventually resolving the matter and returning Cheetos, Doritos and more to shelves across the country. 

Last quarter, Loblaw also pointed fingers at big multinational food brands, saying product costs had risen by double the historic norm. However, at the time one of Canada’s biggest food supplier industry groups told The Canadian Press that suppliers are facing their own pressures in the form of rising manufacturing costs. 

Major food brands including Coca−Cola, PepsiCo, Kraft Heinz and General Mills have reported raising prices in recent earnings releases. 

On an adjusted basis, Loblaw earned $1.94 per diluted share in its latest quarter, up from an adjusted profit of $1.69 per diluted share a year ago.

E−commerce sales for the company were up 13.9 per cent.

Loblaw expects its retail business to grow earnings faster than sales for the full fiscal year, the company said. 

It plans to increase investments in the store network and distribution centres by investing a net amount of $1.6 billion in capital expenditures. 

Patricia Dent

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