CFIN’s upcoming report highlights how the affordability of everyday groceries is worsened by our dependency on importing processed goods and underinvestment in modernizing our food supply chain.
The report argues that Canada needs to address three major problems:
Dependency on importing processed goods
- Grocery prices have risen roughly 22 percent since 2022 — nearly double broader inflation — with the Bank of Canada identifying import costs as the primary driver of 2025’s food price increases.
- Canada is the world’s number one exporter of dried peas, yet “88 percent of production over the past five years has been exported as a raw commodity — a significant missed opportunity for domestic value creation.”
- The processing which determines cost, quality, and supply continuity, happens disproportionately beyond our borders.
- These pressures take six to nine months to work through the supply chain, meaning current trade uncertainty has not even fully arrived at the checkout line.
Underinvestment in agri-food
- Canada’s dependency on imports would matter less if our food sector was well-capitalized or technologically advanced. It is neither.
- Across Canadian SMEs, capital investment in machinery and equipment has declined 16 percent over the past decade, and business productivity fell 0.6 percent from 2019 to 2024 while U.S. productivity rose 10.1 percent.
- The capital gap extends beyond equipment. Although the 2025 federal budget identified agri-food as a key sector, agri-food accounts for less than 2% of government-backed growth, venture, and infrastructure funds at the federal level and captured only 4% of total growth capital invested in Canada over the past five years.
Outdated and fragmented food supply chains
- When a disruption hits, the first question is always: what do we have, where is it, and how fast can we reroute? For most of Canada’s food sector, the honest answers are we do not know, and not fast enough.
- EU-wide research found that technological progress in the food sector — including digital tools, cold chain infrastructure, real-time market information, processing automation, and logistics systems — significantly reduces both food price levels and food price inflation.
- Countries with stronger technological capacities across these domains are better equipped to manage cost fluctuations while maintaining stable prices for consumers.
The full report is attached below.
 Supply Chain Report Draft.doc | [ ] | 1293 kB |