From chocolate to home insurance, climate change is making life more expensive

Published: 2 April 2024

Rising costs of cocoa due to drought and disease affecting crop yields is proof of how global warming is hitting our pocketbooks, agronomist and economist Pascal Thériault, McGill Farm Management and Technology Program Director, told CBC.

The food system "relies on stability, and what climate change does is it creates situations where nothing is stable," he said.

Extreme weather events such as droughts or wildfires, made more frequent by our continued use of fossil fuels, are not only causing localized damage but are affecting crop yields, supply chains and the durability of housing, all of which is making life more expensive.  A paper published this month in the journal Nature found that by 2035, "heatflation" could spike food prices around the world by as much as three percentage points a year.

Extreme weather is also making itself felt in supply chains. 

Theriault, the McGill agricultural economist, said that in North America, most goods move by truck or train, but companies also rely on waterways like the Mississippi River to move grain and other agricultural products.

"It's not usually a problem, but should we have weather patterns such that we could not run those barges at full capacity on the Mississippi River, we would have to find another way to move that grain, which would increase the cost of it," he said.

Theriault emphasizes that global warming isn't the only thing driving inflation. Higher oil prices, as well as increased transportation costs and labour costs, also play a role. 

But of all these factors, climate change is the most intractable problem.

"You can automate to reduce your labour costs. You can get more efficient at packaging," he said. "But ultimately, you can't do anything about climate change."

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