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LILLEY: Impact of war in Ukraine starting to show here at home

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It’s nothing like the price Ukrainians are paying, and it’s nothing like the price Russians will pay, but the war between these two countries on the other side of the world is starting to be felt here.

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From gas to groceries and everything in between, the global chaos we are experiencing is making itself felt here at home.

Gas jumped by two cents a litre on Wednesday, and according to gas price analyst Dan McTeague, it is expected to jump another seven cents on Thursday to more than $1.67 per litre.

In Montreal, they’ve already hit that price; in Vancouver, they are well above that, with prices heading north of $1.75 per litre.

While last year, the average price for a litre of gas was about $1.24, this year it is expected to be over $1.70 unless things change.

While that is a tough pill to swallow for commuters or anyone making a living driving their car, it pales in comparison to the hike in diesel which will jump 26 cents a litre rise at the minimum by Friday.

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Gas price analyst Dan McTeague said that this could see food prices increase dramatically over the coming months if these prices are sustained.

“Diesel is used for fertilizer, it is used for transporting the products. It is likely to drive food prices up 30%-35% year over year,” McTeague said.

Fertilizer prices are also expected to rise as a result of the war. While Canada is the largest producer of potash, one of the main ingredients in fertilizer, Russia is the second-biggest, followed by Belarus and then China.

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Planting in the spring is about to get more expensive for farmers around the world, including right here at home. Ukraine and Russia are also major agricultural producers on many fronts, including staples like wheat and corn.

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“Both countries together account for 25% of global wheat exports,” food policy expert Sylvain Charlebois said Wednesday. The food professor from Dalhousie University added that the conflict is adding to uncertainty and price hikes.

“Barley and rye are also heavily produced in the region. All these commodities combined could compromise many agri-food companies’ access to key ingredients,” Charlebois said.

We have already been dealing with the problem of inflation; this conflict will only make things worse. Our most basic necessities, food, and fuel, have been seeing dramatic price increases that will only get worse.

The most recent report from Statistics Canada put the overall inflation rate at 5.1%, the highest rate since September 1991, but the cost for several food staples was much higher. Beef was up 13.0%, chicken 9%, fish 7.9%, margarine 16.5%, while condiments, spices, and vinegars were up 12.1%.

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All of this is going to rise, just like the cost of fuel.

Like I said, this is nothing compared to the price being paid by the people of Ukraine who are watching their cities and towns being bombed and attacked by Russian President
Vladimir Putin’s army. It won’t even compare to the financial pain that ordinary Russians will feel as sanctions bite into their economy.

None of that negates the fact that what we will experience here is very real and will be difficult for many families. Other than Putin and his henchmen, nobody asked for this war or the economic impacts that we will all be feeling.

As we all feel the squeeze over the next while, remember there is really only one person to blame, and that is the dictator in the Kremlin who thought it was a good idea to try and rebuild the Russian Empire.

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