CALGARY - The food fight is on.

Walmart Canada has fired the opening shot in what is increasingly becoming a battle between grocery chains for customers in Western Canada.

The retail giant announced Friday it is cutting prices on more than 10,000 items in all departments in March, including food, as it's trying to swallow a greater part of the western Canadian market.

The cuts are confined to stores from Manitoba to B.C., and include price reductions of such staples as milk, bread, eggs and butter, as well as toilet paper.

"We are committed to being a price leader in every area of our business," Duncan Mac Naughton, Walmart's chief merchandizing officer, said in releasing the new prices Friday.

The question is: What Walmart's competitors, such as Loblaw, will do?

Probably not much, said Bill Chisholm, a retail analyst with MacDougall, MacDougall and MacTier in Toronto.

"It'll be interesting to see how the rest of them will react," Chisholm said.

"But I suspect no one will underprice Walmart."

The analyst said the reason is what economists call economies of scale: Because of the sheer amount of goods it sells, Walmart can afford price cuts that could be difficult for competitors, such as Loblaw's Real Canadian Superstore division, to match.

But still, Walmart's greater presence is helping keep prices low.

"I would think (competitors' prices) will stay relatively close, but they will not undercut (Walmart)," Chisholm said.

Retail analysts had been predicting Walmart's expansion in Western Canada will lead to aggressive competition to the benefit of consumers.

One of the best examples can be found in Calgary, where a little more than one month ago, Walmart opened a Supercentre right across the street from a Real Canadian Superstore in the Deerfoot Meadows shopping complex. Unlike regular Walmart outlets, Supercentres offer a full grocery section. Walmart is also building a distribution centre in Balzac to feed its growing number of stores in Western Canada.

"Maybe they feel they don't have the same market share in Western Canada as they would like to have," Chisholm said about Walmart's motivation to limit its March price cuts to the western provinces.

Loblaw could not be reached for comment.

markus.ermisch@sunmedia.ca