The Bottom Line
- Ground beef prices jumped more than ten times the general inflation rate in January due to record-low cattle herds on the western Canadian Prairies and expensive grain feed.
- Surging beef prices triggered a consumer shift toward chicken, creating supply shortages compounded by avian influenza and heightened demand for high-protein diets.
Cattle Herd Reductions Drive Ground Beef Costs Higher
Dry weather across the western Canadian Prairies reduced grass and hay supplies.
At the same time, raising livestock became more expensive because of higher prices for grain feed, fuel and labour.
Protein Trends and Avian Flu Strain Poultry Supply Chains
However, the market faced simultaneous supply constraints.
“Everyone’s saying, I need to eat more protein.”
Tomato and Lettuce Markets Stumble Under Tariffs and Drought
Fresh produce items faced severe cross-border supply disruptions. Tomato prices surged due to reduced U.S. farm labour availability stemming from changes to migrant labour, combined with poor weather and dry conditions in Mexico, which represents the bulk of Canada’s imported tomatoes.
“Donald Trump put large tariffs on Mexican tomatoes into the U.S,” said von Massow. “So they planted fewer tomatoes … and then had very dry weather. That sort of was kind of a double whammy.” Higher diesel costs increased the cost of moving fresh produce to Canada. Meanwhile, lettuce growers in California faced persistent drought conditions and crop damage from the impatiens necrotic spot virus.
| Grocery Staple | Primary Cost Driver | Regional Impact |
|---|---|---|
| Ground Beef | Drought, reduced herds, high feed costs | Western Canadian Prairies |
| Chicken | Avian influenza, protein demand shift | National market |
| Tomatoes | U.S. tariffs, Mexican weather, labour limits | Imported from Mexico/U.S. |
| Lettuce | Drought, plant virus (INSV) | California |
Regulatory Investigations Target Grocer Policies and Pricing
The Competition Bureau has been examining the role of major grocers for years. In 2023, it called for more competition to help lower prices.
Manitoba is also looking at replicating unit-pricing laws that already exist in Quebec. However, the Bureau said food prices remain a concern and that more action is needed.
Federal Strategy and Government Response Timelines
“It’s an overall plan. This isn’t going to happen overnight,” he said when asked when Canadians will see lower prices.
