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CFIN

March 26, 2025

How Tariffs Are Impacting Canadian Food Companies (and What They’re Doing About It)

Last week, I caught up with Dana McCauley, CEO of the Canadian Food Innovation Network (CFIN), to discuss some of the challenges facing Canadian food manufacturers amidst the abrupt and surprisingly hostile stance taken by the Trump administration towards our northern neighbors.

CFIN is a national organization dedicated to helping Canadian food and beverage businesses enhance productivity, competitiveness, and economic potential through innovation and technology adoption, and in her position as president of the organization, McCauley had a bird’s eye view on how the Canadian food companies are navigating considerable uncertainty due to shifts in trade policies, tariffs, and antagonistic rhetoric from the U.S. administration

We discussed the disruption caused by sudden policy reversals on trade agreements previously established between Canada and the U.S., and what the imposition of tariffs has meant to Canadian food companies. According to McCauley, the uncertainty forces Canadian food companies to spend extensive resources on scenario planning, detracting from productivity and innovation. McCauley pointed out that these issues are magnified in the food business compared to other industries because of the food’s unique constraints compared to other sectors, such as limited shelf life.

Another struggle for Canadian food manufacturers under the new reality is figuring out how to move forward in a business that often involves complex products that historically have integrated cross-border ingredient lists. McCauley shared the example of organic dairy products, which traditionally have included American-sourced dairy components for value-added products. McCauley said that rising tariffs and trade barriers now render these business models economically unsustainable, prompting businesses to rethink their strategies drastically.

And then there’s the hostile rhetoric from an administration of a country that Canadians have long-seen as their biggest ally. McCauley has said that the result of this rhetoric has been a strong push among consumers to “buy Canadian”. The shift to Canadian and drop American products has been swift and one has to wonder about the long-term damage that Trump is doing to the American brand in Canada and elsewhere.

I asked McCauley how CFIN is supporting Canadian companies given all the sudden changes, and she said that CFIN is actively supporting Canadian food businesses through this volatile period by advocating for enhanced domestic innovation and accelerated regulatory approvals for low-risk food technologies. She emphasized the urgency for Canadian food manufacturers to diversify markets, embrace domestic technological solutions, and leverage Canada’s extensive international trade agreements to navigate ongoing trade uncertainties effectively.

We talk about lots more, so you won’t want to miss our conversation. You can listen to my full conversation below or on The Spoon Podcast.

How Tariffs Are Impacting The Canadian Food Industry

February 4, 2025

A New Report Details Promise (and Challenges) of Canada’s Food & Ag Tech Ecosystem

The Canadian food and agtech ecosystem is experiencing significant growth, according to a new report published today by the Canadian Food Innovation Network.

The report, which dives deep into specific sectors, funding, sector sizing, key challenges and opportunities, says the Canadian agrifoodtech ecosystem lags behind global leaders in both funding and company concentration. According to the report, USD $1.6 billion has been invested in the sector since 2018, with plant-based proteins emerging as Canada’s largest food tech domain, valued at USD $1.7 billion in 2023. However, compared to its global peers, which tend to allocate just 17% of total agrifoodtech investments into agtech, Canada is a bit over-indexed in agtech with 44% of investments compared to 56% invested in food tech (56%).

Despite a total investment in food tech that is smaller relative to its global peers, the report says Canada is establishing itself as a hub for plant-based proteins, biotech-enabled functional foods, and upcycled ingredients:

“The Plant-Based sector is the most significant, comprising 26% of the Canadian food tech ecosystem (investment), compared to 14% globally. This is followed by Functional Foods & Drinks, representing 12% of companies, and Biotech/ Synthetization—primarily focused on specialty ingredients —with 7% of the Canadian food tech ecosystem. All three domains are also amongst the top five most represented globally.“

According to the report, the Canadian food and ag tech ecosystem faces key challenges relative to the US and other markets, the biggest of which is a lack of private capital. Only 40% of food tech investment rounds are backed by venture capital, compared to 60% in the UK and US. This means a heavy reliance on public grants, which comprise nearly 30% of total funding. This is much higher than in the UK (5%) and US (8%). Other challenges include limited scaling resources due to the country’s large geography and lower overall population density, a fragmented regulatory environment and lack of a national food tech strategy.

Despite these challenges, Canadian Food Innovation Network CEO Dana McCauley is optimistic about the sector’s future.

“These challenges are daunting: labour shortages, supply chain vulnerabilities, climate change, and slow rates of innovation threaten the resilience and sustainability of our food system. Yet, Canada’s foodtech ecosystem is rising to the occasion. By leveraging its unique strengths in plant-based proteins, biotech-enabled functional foods, upcycled ingredients, and beyond, the sector is driving transformative innovations that enhance sustainability, boost economic productivity, and create jobs across the country.”

If you’d like to read the full report, you can find it on the CFIN website.

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