Canadians facing financial challenges should brace themselves for an increase in food bills in 2026, as outlined in the 2026 Food Price Report. This annual report, produced by Dalhousie University in collaboration with other Canadian universities, indicated a forecasted rise in food prices between four to six percent.
Dr. Sylvain Charlebois, a lead author and food researcher at Dalhousie University, projected that an average family of four in Canada could see their food expenses rise by up to $1,000, with an exact estimate of $994. As a result, the total food bill for such a family is projected to reach $17,571.79 in 2026. This follows a concerning trend, as food prices in Canada have already surged by 27 percent over the previous five years.
The report identifies several factors contributing to rising food prices, including an ongoing trade dispute with the United States, shifts in the food manufacturing and retail landscapes, labor market dynamics, policy changes, the outlook for the Canadian dollar, and the impact of climate change. The trade tensions are particularly highlighted: "The inflationary impacts of tariffs and counter-tariffs will continue to be felt next year as trade tensions reshape the economic landscape," the report explains. It adds that this dispute has led to market uncertainty, supply chain disruptions, and declining demand for Canadian exports.
There is, however, a glimmer of hope, as Canada seeks to strengthen its relationships with international trading partners to enhance resilience and global competitiveness. The removal of almost all counter-tariffs on U.S. imports is expected to help mitigate inflationary pressures on goods.
Where's the Beef?
The report suggests that beef will experience the highest price increases. Dr. Charlebois attributed these hikes mainly to climate change, resulting in higher costs for feeding livestock. Prolonged drought conditions have prompted ranchers to reduce their herds without replenishing them, leading to lower inventory levels in both Canada and the U.S. Consequently, there is an increased reliance on beef imports from Australia and New Zealand.
As beef prices soar, consumers are turning to chicken, but chicken prices are also anticipated to face upward pressure due to underproduction, a situation worsened by avian flu outbreaks. Additionally, coffee is expected to become significantly more expensive in 2026. Dr. Charlebois explained that climate change has created challenging weather patterns that have adversely affected the yield of Arabica beans, pushing prices upward.
On a more positive note, certain food items, particularly in the produce section, may see stable or even declining prices. Dr. Charlebois noted that while prices in the freezer aisle increased in 2025, they are expected to stabilize moving forward. Similarly, dairy and bakery products are not predicted to experience significant price increases, though higher prices are expected in most other categories, including restaurants.
The restaurant sector faces a complicated situation, characterized by decreasing patronage and lower alcohol consumption rates. While this is beneficial for public health, it poses challenges for the food service industry, which traditionally profits from alcohol sales. As fewer customers dine out and drink less, restaurants may be forced to raise menu prices to maintain profitability, especially in the face of potential closures due to reduced competition.
