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Latest headlines

Appetite for Canadian food products supports manufacturing growth

Canadian officials investigate Listeria outbreak
March 31, 2016

Although Canadian consumer spending is weak, the outlook for Canadian food manufacturing remains bright thanks to rising demand from the US and other foreign markets, according to The Conference Board of Canada's latest Canadian Industrial Outlook: Canada's Food Manufacturing Industry. Canada's food manufacturing's industry is forecast to grow by 2.1 percent in 2016.

“Faced with weak disposable income gains and rising household debt, Canadians will be more frugal when it comes to how they spend their food budget,” says Michael Burt, director of Industrial Economic Trends. “Luckily for food manufacturers, Canada's new trade era of lower commodity prices, a weaker Canadian dollar, and strengthening demand from south of the border will open up new opportunities for the food manufacturing industry.”

Labor costs are forecast to be the largest contributor to industry costs, growing by an annual average of 5 percent over the next two years.

One segment of the industry that can expect to see strong growth is seafood manufacturing, which is on the rise in part due to consumers curbing their red meat intake. Likewise, the rising number of baby-boomers is expected to support growth in demand for seafood and fish products. Researchers say foreign markets; demand for Canadian manufactured seafood products is also expected to continue to grow robustly, as improving incomes in emerging markets support demand from high-quality sources of protein. 

Export growth is expected to remain a bright spot for food manufacturers. Industry export levels are at record highs and the combination of a weaker Canadian dollar and stronger US economy is expected to continue to support export growth going forward. According to a recent Conference Board of Canada report, Canada’s food manufacturing is among the very few manufacturing industries ready to benefit from the US recovery and able to ramp up production to meet this rising demand.

KEYWORDS: consumer trends food and beverage industry trends food and beverage manufacturing

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