Canadian Grocery Prices Rise as Trade War Tariffs Kick In

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The ongoing trade tensions between Canada and the United States are starting to show up where it matters most — on Canadian grocery prices. While many U.S. products still make their way across the border tariff-free, some fresh produce and prepared foods have become noticeably more expensive.

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Smaller Grocers Feeling the Pressure First

Independent grocers, who already operate on razor-thin margins of about 2%, are struggling to absorb rising supplier costs. Gary Sands, senior VP at the Canadian Federation of Independent Grocers, explains that many are left with no choice but to pass the increase to consumers.

Produce has been hit hardest so far, especially fresh items like oranges, berries, and shrimp, which now carry a 25% counter-tariff. Since fresh items move fast through the supply chain, the effects are immediate.

Tariff-Driven Price Differences Now Visible

Tariffs are creating noticeable gaps in product pricing. At Loblaws, Canadian-made orange juice brands range from $5 to $7.69, while Tropicana, an American brand, costs $8.72. At Metro, the price jump is even more pronounced, with Tropicana priced at $13.99, nearly double some Canadian options.

Food Inflation Creeping Up

Statistics Canada reported that food prices rose by 2.8% year-over-year in February. By March, that increase had climbed to 3.2%, signaling that tariffs and supplier adjustments are beginning to feed into broader food inflation.

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Economist Stuart Smyth from the University of Saskatchewan notes that market uncertainty is also a factor. The frequent flip-flopping on trade decisions has made price-setting more volatile across the board.

Canadian Producers Also Paying More

It’s not just American products going up in price. Canadian producers who import ingredients from the U.S. are also absorbing higher costs. Items like coffee, chocolate, canned tomatoes, and nuts are now more expensive to produce locally. For now, many producers are delaying price hikes to see how the situation develops.

Shoppers Want More Canadian Options

A recent Leger poll found that 81% of Canadians are trying to buy more Canadian-made groceries. This adds pressure on grocers to shift their supply chains quickly. But switching suppliers — for example, sourcing oranges from Turkey or South Africa — isn’t easy for smaller retailers.

Sands says the demand for Canadian products is at a level he hasn’t seen in 25 years of industry experience.

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Impact Still Unfolding

Although some price increases are already visible, the full impact of the tariffs hasn’t landed yet. That’s because most retailers require suppliers to apply for price increases, a process that can take six to twelve weeks.

At the same time, shoppers are still able to sidestep some of the price hikes by choosing Canadian-made or alternative brands. For example, skipping U.S. brands like Tropicana helps avoid the tariff premium.

Some Key Products Remain Exempt

To avoid hurting Canadian shoppers, the federal government chose not to tariff certain essentials — like leafy greens, which Canada heavily imports during the winter and early spring. Experts say this was a smart move to keep everyday prices from rising too quickly.

As Canada’s growing season begins, consumers can look forward to more locally grown produce, which will help limit the impact of tariffs — at least for now.

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