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As Canadian consumers grapple with rising grocery bills, new data from Statistics Canada shows food inflation remains a key pressure point, with tariffs compounding the issue across multiple categories.
The Consumer Price Index (CPI) rose 2.3 per cent in March, but food prices outpaced the general trend, climbing 3.2 per cent compared to the same time last year. Although the immediate impact of Canada's counter tariffs has been muted by existing inventory, retailers and industry experts warn that consumers will soon see the full cost at checkout.
“Tariffs are still stacking up behind the scenes,” said an industry spokesperson. “As inventories are depleted, higher prices will hit the shelves — and shoppers will feel it.”
One notable pressure point lies in the egg market. While Canada has been relatively shielded from the dramatic spikes in egg prices seen in the United States — up over 60 per cent year-over-year due to the avian flu crisis — Canadian bakers are still feeling the pinch. That's because Canada is a net importer of liquid eggs from the U.S., and those prices have surged.
While whole eggs on grocery shelves remain stable, the biggest hit is being felt in baked goods like muffins, cakes and cookies, where imported liquid eggs are a key ingredient.
Tariffs are also raising questions around what consumers are actually paying for in so-called "Made in Canada" products.
A product can be labelled “Made in Canada” even if key ingredients are imported, as long as the last substantial transformation happens domestically. Take a granola bar, for example: while it may be manufactured in Canada, imported ingredients such as U.S.-sourced chocolate chips and peanuts are now subject to a 25 per cent tariff — costs that are partially passed down to consumers.
Meat prices continue to climb, particularly pork and chicken, amid increased demand and supply constraints. The Canadian beef herd, now at its smallest since the 1970s, has been impacted by drought and high feed prices.
Nuts are also seeing price hikes due to weather challenges in key growing regions and rising global demand. Year-over-year, the combined price of almonds, cashews, walnuts, pecans and Brazil nuts is up nearly 33 per cent.
Coffee lovers aren’t spared either. A tight global harvest in 2024 and potential U.S. tariffs on imports from countries like Vietnam — the world’s second-largest coffee producer — are creating pricing volatility. If tariffs resume, a $1 cup of coffee imported via the U.S. could cost Canadian consumers up to $1.82 once additional duties are applied.
Economists warn that if tariff pressures persist or expand, inflationary impacts will ripple further across the food supply chain. Combined with commodity volatility and climate-related production challenges, the road to price stability remains uncertain.