Doritos maker Frito-Lay halts shipments to Loblaw over price dispute

The situation has left the chip and snack food aisle of many Loblaw stores less full than usual or stocked with the retailer's house brands, such as President's Choice or No Name.

One of Canada’s biggest food manufacturers has halted shipments to the country’s largest grocer in an extreme example of how inflation is impacting the food industry and driving a wedge between some retailers and suppliers.

At issue is a dispute over pricing between Frito-Lay Canada and Loblaw Companies Ltd. as the maker of brands like Cheetos, Doritos, Lays, Ruffles and Sunchips tries to recoup higher costs.

The situation has left the chip and snack food aisle of many Loblaw stores less full than usual or stocked with the retailer’s house brands, such as President’s Choice or No Name.

Frito-Lay spokeswoman Sheri Morgan confirmed there is a “temporary disruption” with one customer.

“Our business has faced unprecedented pressures from rising costs of items including ingredients, packaging and transportation,” she said in an email.

“To help offset these pressures on our Canadian operations … we have made adjustments to our prices that are consistent across the marketplace.”

Loblaw spokeswoman Catherine Thomas said the grocer is “laser focused” on minimizing retail price increases.

“When suppliers request higher costs, we do a detailed review to ensure they are appropriate,” she said in an email. “This can lead to difficult conversations and, in extreme cases, suppliers don’t ship us products.”