Canada’s food system has always been built on innovation; from advances in crop production and farm technology to improvements in processing, transportation, and consumer products. Today, a new opportunity is emerging beyond the farm gate: improving productivity across Canada’s food and beverage manufacturing sector. This represents a new era of growth in Canadian food manufacturing.
A recent report from Farm Credit Canada (FCC), Prospects for Future Productivity Growth in Canadian Food and Beverage Manufacturing, highlights the potential economic impact of increasing productivity in one of Canada’s largest industries. According to the report, achieving 3 percent annual GDP growth in the food and beverage manufacturing sector over the next decade could add up to $40 billion to Canada’s economy. This growth could also create approximately 217,000 new jobs, generate $1.3 billion in additional tax revenue, and contribute $16 billion in wages and benefits for Canadians.
The message is clear: improving how we produce, process, and move food through the supply chain will play a critical role in strengthening Canada’s competitiveness.
What Does Productivity Really Mean?
Productivity is often described as “d
oing more with less.” In the food and beverage sector, this does not mean replacing the people behind the industry, it means finding better ways to use technology, skills, and resources to increase efficiency.
For food manufacturers, productivity gains may come from investing in modern equipment, automation, digital tools, improved processes, and a skilled workforce. These investments can help companies increase production capacity, reduce waste, respond to changing consumer demands, and compete in global markets.
However, FCC’s report highlights that productivity growth in Canada’s food and beverage manufacturing sector has slowed in recent years. Labour productivity declined by an average of 0.5 percent annually between 2015 and 2022, creating a challenge for an industry facing rising costs, labour pressures, and increased global competition.
Innovation Across the Food Supply Chain
The opportunity for growth extends across the entire food system. Farmers, processors, researchers, technology providers, and policymakers all play a role in creating a more efficient and resilient food supply chain. FCC identified several key areas that could help unlock future growth, including:
Investment in technology and infrastructure
Modernizing processing facilities, upgrading equipment, and adopting new technologies can help businesses improve efficiency and expand production.
Building a skilled workforce
As food production becomes more advanced, access to training and skilled employees will become increasingly important.
Reducing barriers to growth
Streamlining regulations and improving market access can help businesses invest, expand, and reach new customers.
Expanding global opportunities
Trade diversification and stronger international connections can help Canadian food businesses compete in growing markets.
CEO and president of FCC Justine Hendricks says, “By putting productivity and innovation at the centre of how we grow, we can strengthen our food system, support the people behind it and build a more resilient industry for today and future generations.”
Why This Matters for Agriculture
While the report focuses on food and beverage manufacturing, the impacts reach far beyond processing facilities. A stronger domestic food industry creates new opportunities for Canadian farmers by increasing demand for locally produced commodities and supporting a more connected value chain.
From grains and oilseeds entering food ingredients to livestock and horticultural products reaching consumers, every stage of the food system depends on collaboration and innovation. Canada has built a reputation as a reliable global food supplier. Maintaining that position will require continued investment in research, technology, and productivity ensuring the industry can meet future challenges while supporting economic growth.
Looking Ahead: Turning Potential Into Progress
The $40 billion opportunity identified by FCC represents more than an economic forecast; it represents a vision for the future of Canadian food. The next generation of growth will come from combining the strengths Canada already has: world-class agriculture, innovative businesses, talented people, and a commitment to producing safe, high-quality food. As consumer expectations continue to evolve and global competition increases, productivity will be a key ingredient in keeping Canada’s food sector strong from farm to fork.
References
- https://www.fcc-fac.ca/en/knowledge/canadian-food-manufacturing-power
- https://www.fcc-fac.ca/en/about-fcc/media-centre/news-releases/2025/canada-agriculture-productivity