Price Increases: 1) Average family expected to spend $994 more on food next year: report; 2) Insurers stress importance of commercial coverage despite rising premiums

Courtesy Barrie360.com and Canadian Press

By Ian Bickis, December 4, 2025

Expect food to take up a bigger share of household budgets next year.

The latest Food Price Report produced by several Canadian universities is projecting an average family of four will pay an estimated $994.63 more for food in 2026 than this year because of issues like trade and climate change. 

The increase, making for an estimated total bill of $17,571.79, comes from a projected four to six per cent inflation rate for food next year, according to the report produced by the agri-food analytics lab at Dalhousie University in partnership with several other universities. 

The inflation rate is higher than the roughly four per cent seen this year, and would outpace an overall inflation rate that’s expected to decline to the Bank of Canada’s two per cent target. 

The growth in food prices next year is expected even as trade-related price pressures continue to decrease, said lead author Sylvain Charlebois.

“Geopolitics will remain an unknown into 2026, but we are expecting tariffs not to be as much of an issue in 2026 than in 2025, which is good news.”

Canada lifted almost all counter-tariffs against the U.S. in September, while just recently U.S. President Donald Trump also walked back tariffs on more than 200 agricultural and food products.

The U.S. tariffs, which included a 50 per cent levy on coffee-producing giant Brazil, were also putting upward pressure on Canadian prices for goods that either flowed through the U.S. or were simply feeling a knock-on effect.

Long shelf-life items like coffee will likely take some time to see prices decline, compared with something like bananas on which the U.S. has also walked back tariffs.

And while trade issues are lessening, the investments companies are having to make in supply chains and diversifying trade partners are also creating higher costs — though not as bad as initially feared, said Charlebois. 

“I was a little bit concerned with the buy Canadian movement and people walking away from American products, forcing grocers to import from other places where it could be more expensive,” he said.

“But I actually do think that grocers did a pretty good job finding new sources that were either affordable or cheaper.”

The results could be see in vegetable prices that actually declined 0.9 per cent this year, and fruit prices that were down 1.1 per cent.

The downward trend isn’t expected to continue into next year though, with fruit prices possibly heading one to three per cent higher and vegetables expected to rise three to five per cent.

Meat is the main driver in food inflation though, up 7.2 per cent this year, and projected to rise another five to seven per cent next year.

Prices are rising as cattle herds in January were at their smallest level since 1988, the report said, noting that drought has pushed up feed costs while packing and processing costs are also increasing.

“The beef situation is problematic,” said Charlebois. 

“I honestly do not understand why Ottawa is not looking into this.”

While beef imports are already rising from Mexico, he said the government should be looking to allow more imports from countries like Australia to ease the pressure.

As beef prices have climbed, more buyers have shifted to chicken which has also caused prices to spike there, though it takes much less time to adjust flock size than cattle herds, he said.

The droughts helping push up beef prices can be linked to the wider issues of climate change that continue to disrupt systems, said Sadaf Mollaei, an adviser to the report and the Arrell chair in the business of food at the University of Guelph.

“Climate change has a very significant effect on prices, and it will most likely increase the prices because of these severe climate situations that we see in places where food is produced,” she said.

“If there are wildfires in California, if there are droughts in parts of Canada, when the length of seasons change, it’s going to impact crop production and it’s going to impact the supply chain.”

The report noted that prices rose significantly this year because of weather issues on a range of imports including coffee and tea, cocoa, strawberries, oranges, squash and carrots.

Mollaei said there is some movement toward more plant-based sources of proteins, but that it should be happening because consumers see them as healthier and more sustainable, not because people can’t afford other options.

Seafood should remain more in reach next year, with prices expected to rise one to two per cent, while dairy and eggs could see a two to four per cent gain.

Restaurants will likely get pricier with a four to six per cent projected increase.

One other area to watch in 2026 is what effect the Canada Grocery Code has, with formal operations launching in January. 

Charlebois said the code of conduct could help suppress the power that grocers have over their suppliers, which could help lead to more price stability.

“Getting processors, vendors, and grocers to the table to negotiate in fairness, in good spirit, will eventually help consumers over time,” he said.

“So 2026 is going to be an important year in that regard.” 

2) Insurers stress importance of commercial coverage despite rising premiums

Courtesy Barrie360.com and Canadian Press

By Sammy Hudes, December 4, 2025

As an electrician, David Clark knows there are countless “niche” risks when he’s on the job.

A fluke accident could endanger his own safety, or that of a client, not to mention the possibility of causing damage to the expensive equipment he carries to a job site.

While those risks are always top of mind, there are even some he hadn’t thought of when he started his business, DSD Electric, and took out insurance three years ago.

Clark points to his errors and omissions coverage with TD — something that could come in handy if, for example, he’s operating in a commercial space and his electrical work accidentally causes damage to equipment integral to his customer’s business operations.

Without such coverage, he could also be liable if a power outage on his watch interrupts the client’s workflow, resulting in lost revenue.

“There’s certain things that you don’t know for sure you’re going to need until it happens,” Clark said, “and you always want to be covered for those specific things.”

Insurance providers say small business owners starting out often face surprises about the type and level of coverage they need. Finding the right plan depends on a variety of risks they could be exposed to, based on factors such as the size of their company and field of work.

For instance, a bakery owner will have very different insurance needs than a contractor, said Tang Trang, vice-president of small business insurance at TD Insurance.

“So often, the coverage is having to adapt to the type of activities that the business owner is doing,” he said.

While a baker would need a policy that includes basic liability insurance and coverage for kitchen equipment, they also likely need to think about business interruption coverage in case they’re ever forced to temporarily shutter from a fire or flood.

Others who aren’t bound to a fixed location would likely need a form of auto coverage.

“Contractors, they might need a different type of insurance because as part of the operation, they need a car or a pickup van,” said Trang.

“They need to drive the tools and equipment from one site to another.”

Meanwhile, those starting a business from home may not realize the need for separate coverage from their existing home policy, he said, as insurers will often deny such claims if a business link is discovered.

“You may be working in a home business, let’s say as a massage therapist. There’s clearly a dedicated space where customers can walk in, so (you’re) receiving clients. The massage therapist potentially has specific equipment as well that are solely dedicated for the business,” said Trang.

“Although all of those things are located at home, they are not necessarily covered by your home policy because it’s clearly a business activity.”

Trang acknowledged that insurance costs can be seen as a burden for startups looking to dedicate as much of their budget as possible toward growing the business from scratch.

While it could be tempting to cut corners, he stressed the importance of limiting risk.

“When unfortunately a fire happens or a catastrophe happens, they may realize they don’t have the insurance they would have benefited from,” he said.

In a late 2024 survey, the Canadian Federation of Independent Business said insurance costs had become a top concern for more than two-thirds of small businesses, with half experiencing an increase of 10 per cent or more in their insurance premiums over the previous 12 months.

Those hikes would equate to at least $1,500 more per year in insurance premiums for a typical small- or medium-sized business, according to the federation.

Its latest monthly business barometer report last month echoed those concerns, as 69 per cent of small business owners said insurance costs were a key constraint hindering growth, second only to tax and regulatory expenses.

One of the reasons those costs are so high is due to limited options that fit the needs of small firms, said Jasmin Guenette, vice-president of national affairs at CFIB.

He said although there are many insurance companies in Canada, small businesses may find that some coverages related to their specific sector aren’t universally offered by insurers.

“Some sectors are seen as high risk. For example, the trucking sector is seen as high risk because of drivers being on the road all the time,” said Guenette.

“Depending on your business, the price is influenced by many factors. One is the risk. (Another) is the number of insurers willing to be in the sector you are in, and the size of your business.”

He said commercial insurance can be “complex” for small firms to navigate, especially when it seems far-fetched to envision certain protections ever being needed down the road.

“It could be several years without having any claims, so it’s always a judgment call whether or not you base your decision on faith or you base your decision on risk analysis,” said Guenette.

For Clark, the peace of mind is worth the cost.

The Toronto electrician said the less risk the better for his growing business, which is why he aims to have “every bit and piece covered” under his insurance plan.

“You’ve got to make sure you have your butt covered,” he said.

“You never know what’s going to happen, like, you go outside and your van’s gone. I have a lot of tools in my van that are my livelihood. Without them I can’t do anything with just my bare hands.”