The above rel canonical on the page is perfectly fine. They should not be reason for your ranking drop and can be left untouched. However, make sure that all pages have canonical set as respective page URLs.
These are generally added give a directive to search engines about the one version of URL to be indexed. Reasons for the same can be numerously like reducing duplicate content on the site (especially ecommercce site) to ensuring the link value passes to main URL where people link to your pages using utm parameters.
You can read more about canonical tags here: http://support.google.com/webmasters/bin/answer.py?hl=en&answer=139394