Between 19 November 2020 and 25 February 2021, the House of Commons Standing Committee on Agriculture and Agri-Food conducted a study on measures that could be taken to increase Canada’s capacity to process more of the food it produces domestically and to strengthen local food supply chains.

Canada’s food and beverage processing industry is the second-largest manufacturing industry in the country, accounting for $117.8 billion of economic activity in 2019. Food and beverage processing businesses employ some 290,000 people in Canada, more than any other industry in the manufacturing sector. In 2017, the Agri-Food Economic Strategy Table reported that the industry’s export growth potential is particularly strong.

This report provides an overview of the main capacity limitations facing the food processing sector in Canada and makes recommendations to the government to help the sector reach its full potential. The report outlines the key challenges relating to processing and transportation infrastructure. Encouraging the development of small regional abattoirs to promote food security across the country is one of the Committee’s recommendations in this regard.

While regulations play an important role in the sector’s success, they can sometimes hamper investment and innovation. The Committee therefore recommends that the government review some of its regulations, including those governing beef processing. The government should also consider expanding the eligibility of food processors to the Temporary Foreign Worker Program and the Seasonal Agricultural Worker Program, notably by making these programmes more flexible and by raising the cap on the number of workers who can be hired through the low-wage stream. However, the stakeholders heard during the study pointed out that the Temporary Foreign Worker Program cannot be the only solution to the problem of labour shortages. Greater automation should be encouraged where possible, and the industry’s appeal to the next generation of workers and those who are retraining should be enhanced.

Food processors are dealing with a concentrated retail market in Canada that is dominated by a few large retailers. A number of stakeholders suggested establishing a code of conduct for grocers to standardize the relationship between food suppliers and retailers. However, since such a code would fall under provincial and territorial jurisdiction, the Committee recommends that the federal government help the provinces and territories put one in place.