Food prices expected to continue to climb again this year
Canadian families are expected to spend up to $994 more on food in 2026, according to Dr. Sadaf Mollaei, an assistant professor at the School of Hospitality, Food, and Tourism Management at the University of Guelph.
Mollaei worked as one of the advisors for this year’s Canada Food Price Report. The report is drafted from a collection of data that is then analyzed by several researchers, who then send off their findings to advisors.
Produced collaboratively by Dalhousie University, Saint Mary’s University, the University of Prince Edward Island, Cape Breton University, the University of Guelph, Université Laval, the University of British Columbia and the University of Saskatchewan, the report marks its 16th annual edition. For 2026, researchers relied on a systemized forecasting model that incorporated climate change, geopolitics and economic indicators.
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The report forecasts overall food price increases of four to six per cent next year, bringing the average annual grocery bill for a family of four to $17,571.79. Food prices are now 27% higher than five years ago, a trend that has coincided with a rise in food insecurity, affecting roughly one in four Canadian households.
“There are a variety of reasons that are going to be impacting food prices,” Mollaei explained to The Observer. “Variables such as climate change, geopolitical risks, inflation, energy costs, things that don’t necessarily have anything to do with food in a sense that you would think.
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“And then you also have some variables that are more related to the sector itself. So, the retailers, distribution, our policies and regulations, for example, the labelling that we see at the store. And then we also have some factors related to consumers and how they make their choices. All of these factors are going to impact food prices in different ways.”
Mollaei’s sentiments are echoed amongst her colleagues within the report.
“Prices are only one piece of Canada’s complex food industry story,” said Dr. Evan Fraser, director of the Arrell Food Institute at the University of Guelph. “Our food system sits in the middle of shifting disputes, behaviours and policies. Affordable access to food is ultimately a matter of security.”
Mollaei added, “For 2026, geopolitical risks are going to be significantly harmful.”
Geopolitical risks are threats from political instability, conflict, terrorism, trade wars, sanctions, and even cyber warfare, that can disrupt global stability.
Of the risks that she expects to be the most impactful on prices in the story, Mollaei said. “The trade wars are going to be significantly impactful for prices. Because it impacts pricing and it impacts the supply chain, it will have an impact on the price. And price increases usually happen very fast, but then for it to get back, or at least not increase, it takes a long time.”
This means that even if a trade war were to end suddenly, families would still be feeling its impacts long after the initial disruption.
Additionally, climate-related disruption continues to play a growing role in food costs, particularly for animal-based products. Beef prices rose sharply in 2025, jumping 19% in the first quarter and remaining 23% above the five-year average, driven largely by a prolonged drought in Western Canada that has reduced national cattle herds to their lowest levels since the late 1980s.
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But it’s not just beef that’s going to rise this year.
“We’re going to see an increase for beef, chicken, pork, all at the same time,” said Mollaei. “[This] doesn’t usually happen, especially for chicken.”
Mollaei expects the three industries to see the sharpest increase, according to estimates in the report.
Climate is directly implicated in the continued rise in beef costs.
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“Nearly a decade of drought in Canada’s leading beef-producing regions has constrained supply,” said Dr. Stuart Smyth, campus lead at the University of Saskatchewan. “With demand holding steady, that imbalance puts sustained upward pressure on prices.”
Climate volatility is also contributing to broader instability across global food markets. International research has shown that climate-sensitive foods such as beef, dairy, coffee and chocolate are rising in price significantly faster than other grocery items, as extreme weather events disrupt production and transportation.
In Canada, that pressure is being felt unevenly across provinces. Alberta, New Brunswick, Nova Scotia, Ontario and Quebec are all forecast to experience food price increases above the national average in 2026. New data from Statistics Canada show food prices rose 3.4% year-over-year nationally, with staples such as berries, grapes, coffee and ground beef continuing to climb month over month in every province.
According to Mollaei, 2026 may be the year of seafood and cream sauces.
“Some fruits and also seafood are not anticipating a very high price increase,” Mollaei said. “And then also dairy and egg are a category that is going to see a more moderate price increase.”
Mollaei suggest that’s a positive point. “These are all categories of food that are considered healthy and nutritious, and a way for people to get their nutrients in without spending a lot. Affordability is a big issue for people.”
Of the people believed to be most at risk, Mollaei said, “Minorities and the people that are in a lower socioeconomic status… are going to be feeling that pressure more. But then also, with the rising cost of everything else, we might see more people fall into this category, and that’s something we really need to avoid.”
Consumer behaviour is already shifting in response. The report notes that 86% of Canadians are eating less meat, with many households turning to plant-based proteins as beef prices climb or as local food box initiatives become more common.
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“Food inflation is forcing Canadians to make daily trade-offs,” said Dr. Stacey Taylor, assistant professor of business analytics at Cape Breton University. “That can mean switching brands, delaying purchases, or sacrificing nutritional quality.”
Food insecurity is already playing out in communities across Ontario, and is far from just a national statistic. Over one million Ontarians accessed food banks in 2025 as grocery inflation pushed more households into need, with farmers and local partners stepping in to support rising demand.
“We need a more holistic approach to this problem of affordability, and food is a part of that whole system,” Mollaei said. “For example… cross-provincial regulations, food transport, regulations in terms of safety, and all of that is going to make it easier for provinces to be able to trade. That is going to have an impact on the food system as a whole.”
Mollaei emphasized that prices at the store are driven by the entire system, and thus changes to the system could have a meaningful effect on people’s lives. She lists wages, workforce, and health as other parts of the puzzle that “come together for people to be able to live and have a good, decent life.”
With climate-related disruption expected to intensify, the report concludes that food price volatility is unlikely to ease in the near term, even as inflation stabilizes. For many households, the cost of eating well may continue to rise faster than incomes, reinforcing concerns about both food security and nutritional access in the years ahead.
