Food prices set to rise up to 5% in 2025: report
Grocery bills are set to take another jump next year. The Food Price Report 2025 forecasts that food prices will increase between 3% to 5% in the coming year. That means the average family of four will fork over $801.56 more on food compared to 2024, for a total of $16,833.67.
By category, the predicted price increase is highest in meat (4% to 6%), followed by vegetables and restaurants (both at 3% to 5%). Fruit and seafood were on the lower end (1% to 3% each). The report, now in its 15th year, was published by Dalhousie University, University of Guelph, University of British Columbia and University of Saskatchewan.
Last year’s Food Price Report predicted an overall price increase of 2.5% to 4.5% in 2024. According to the researchers, the current rate for food price increases is within the predicted range, at 2.8%.
READ: Is Canada's Food Price Report actually accurate? Most of the time
“I’m a little concerned—it’s higher than last year,” says Sylvain Charlebois, professor in food distribution policy and senior director of the Agri-Food Analytics Lab at Dalhousie University. “We’re seeing some headwinds for the industry and obviously for consumers as well.”
On a macroeconomic level, geopolitical risks, climate change, currencies and the trade environment are named as key variables shaping next year’s projected food prices.
“There is some uncertainty around trade and our economy and how it’s perceived worldwide. That is going to impact the dollar,” says Charlebois. In addition, interest rates will likely go down. “And when interest rates go down, the dollar is likely going to weaken versus the greenback, which will impact our grocers’ ability to import cheaper products,” says Charlebois, noting that Canada imports $34 billion worth of food every year. “Notwithstanding the fact that we may be dealing with tariffs—which we address in the report—[food imports] could get very expensive.”
To cope with ever-rising food prices, Canadians will continue to try to stretch their dollars at the grocery store. The Food Price Report highlights findings from Dalhousie University’s Canadian Food Sentiment Index—released in October—which found that nearly half of respondents (48.2%) are looking for more sales and discounts. In addition, 30.5% are using more coupons, 24.9% are shopping at cheaper stores, 22% are buying fewer non-essential food items, and 21.6% are switching to cheaper brands. At the same time, record numbers of Canadians are relying on food banks. Food Banks Canada recorded two million visits to food banks in one month (March 2024) – a 90% increase compared to 2019.
“We can clearly see that consumers are under tremendous financial pressure, and that pressure is going to continue for a while,” says Charlebois. “But I’ve always believed that the pain consumers are feeling isn’t necessarily just at the grocery store. It’s everywhere. Everything is more expensive. And when they show up at the grocery store, they’re showing up with less disposable income. And so, that’s why you’re seeing [major] grocers shifting their discounting strategies… The entire infrastructure of the industry is shifting.”
