1 Introduction

Rising food prices have increased affordability pressures for Canadian households. While the Consumer Price Index (CPI) measures changes in food prices, it does not indicate how much more households must spend to purchase the same grocery basket over time.

This report combines expenditure data from the 2023 Survey of Household Spending (SHS) with detailed food-component CPI data to estimate the cost of purchasing the same 2023 grocery basket at April 2025 and April 2026 prices.

The analysis addresses four questions:

  1. How much has the cost of purchasing the 2023 grocery basket increased at April 2025 and April 2026 prices?

  2. Which food categories contributed most to the increase in the cost of the 2023 grocery basket?

  3. How did the increase in grocery costs vary across household income groups?

  4. How did the cost of purchasing the same 2023 grocery basket vary across provinces when provincial food price changes are taken into account?

By linking household spending patterns to detailed food price changes, the report provides a consumer-focused assessment of the affordability impacts of food inflation in Canada.

2 Data

2.1 Survey of Household Spending

The analysis uses the 2023 Survey of Household Spending (SHS) Public Use Microdata File.

The food basket consists of the following broad expenditure categories:

  • Bakery products
  • Cereal grains and cereal products
  • Fruit, fruit preparations and nuts
  • Vegetables and vegetable preparations
  • Dairy products and eggs
  • Meat
  • Fish and seafood
  • Non-alcoholic beverages and other food products

These categories account for approximately:

Coverage of the SHS Food Basket
Measure Percent
Coverage of Total Food Expenditure 71.9
Coverage of Food Purchased From Stores 99.6

2.2 Food Basket Construction

The analysis uses household expenditure data from the 2023 Survey of Household Spending (SHS). A grocery basket was constructed using eight broad food expenditure categories:

  • Bakery products (FD100)
  • Cereal grains and cereal products (FD200)
  • Fruit, fruit preparations and nuts (FD300)
  • Vegetables and vegetable preparations (FD400)
  • Dairy products and eggs (FD500)
  • Meat (FD600)
  • Fish and seafood (FD700)
  • Non-alcoholic beverages and other food products (FD800)

These eight categories account for approximately 99.6 percent of food purchased from stores and 71.9 percent of total household food expenditures. Consequently, the basket provides near-complete coverage of grocery spending while excluding restaurant expenditures.

2.3 Consumer Price Index

Food expenditure categories were matched to corresponding food aggregates from Statistics Canada’s Consumer Price Index (CPI).

SHS-CPI Concordance
SHS_Category CPI_Category
Bakery products Bakery products
Cereal grains and cereal products Cereal products (excluding baby food)
Fruit, fruit preparations and nuts Fruit, fruit preparations and nuts
Vegetables and vegetable preparations Vegetables and vegetable preparations
Dairy products and eggs Dairy products and eggs
Meat Meat
Fish and seafood Fish, seafood and other marine products
Other food products and beverages Other food products and non-alcoholic beverages

3 Methodology

The analysis adopts a fixed-basket approach similar to that used in the Consumer Price Index (CPI). Household expenditures observed in the 2023 Survey of Household Spending (SHS) are treated as a fixed consumption basket and repriced using food-component CPI levels from April 2025 and April 2026.

For household \(h\), annual grocery expenditures in the base year are defined as:

\[ F_{h,2023} = \sum_j E_{hj} \]

where:

  • \(E_{hj}\) denotes 2023 expenditure on food category \(j\).

Category-specific price adjustment factors are calculated as:

\[ A_{jt} = \frac{CPI_{jt}} {\overline{CPI}_{j,2023}} \]

where:

  • \(CPI_{jt}\) is the CPI level for food category \(j\) in period \(t\);
  • \(\overline{CPI}_{j,2023}\) is the average CPI level for category \(j\) during 2023;
  • \(t \in \{\text{April 2025}, \text{April 2026}\}\).

The estimated cost of purchasing the same 2023 basket in period \(t\) is:

\[ F_{ht} = \sum_j E_{hj} A_{jt} \]

For example, \(F_{h,\text{Apr2025}}\) represents the cost of purchasing the 2023 grocery basket using April 2025 prices, while \(F_{h,\text{Apr2026}}\) represents the cost of purchasing the same basket using April 2026 prices.

The additional annual grocery cost associated with food price increases between 2023 and period \(t\) is:

\[ \Delta F_{ht} = F_{ht} - F_{h,2023} \]

In the empirical analysis, results are reported for both April 2025 and April 2026, with particular emphasis on April 2026 as the most recent observation.

Food inflation burden is measured as:

\[ Burden_{ht} = 100 \times \frac{ F_{ht} - F_{h,2023} } {Income_h} \]

This measure represents the share of household income required to absorb the additional cost of purchasing the same 2023 grocery basket at April 2025 or April 2026 prices.

4 National Results

4.1 Food Price Growth by Category

Food prices increased across most major food categories between average 2023 prices and both April 2025 and April 2026. Meat experienced the largest increase, followed by other food products and non-alcoholic beverages, while cereal products showed relatively little price growth.

4.2 Cost of the Average Canadian Grocery Basket

Cost of the Average Canadian Grocery Basket
Basket Cost
Average 2023 Prices 8668.82
April 2025 Prices 9080.73
April 2026 Prices 9425.22

4.2.1 Key Findings

The average Canadian household spent approximately $8,668.82 on food purchased from stores in 2023.

Valuing the same basket at April 2025 prices increases annual expenditures to approximately $9,080.73, while April 2026 prices increase expenditures further to $9,425.22.

Overall, the cost of the average grocery basket increased by approximately $756.40, equivalent to 8.7 percent, between average 2023 prices and April 2026 prices.

4.3 Contribution of Food Categories to the Increase in Grocery Costs

To better understand the sources of food inflation, the increase in the cost of the average grocery basket was decomposed into contributions from each major food category. The contribution of each category is calculated as the additional annual expenditure required to purchase the same 2023 quantity of that category at April 2026 prices.

Contribution of Food Categories to the Increase in Grocery Costs
Category Additional_Cost Share
Other Food Products 270 35.7
Meat 231 30.5
Vegetables 79 10.4
Dairy and Eggs 66 8.7
Fruit 64 8.5
Bakery Products 36 4.8
Fish and Seafood 10 1.3
Cereal Products 1 0.1

4.3.1 Additional Annual Cost by Food Category

4.3.2 Key Findings

The increase in the cost of the average grocery basket was not uniform across food categories. Categories with both large expenditure shares and strong price growth contributed the most to the overall increase in food costs.

In particular, meat, dairy products and eggs, fruit, vegetables, and other food products accounted for the majority of the increase in annual grocery expenditures. By contrast, cereal products contributed relatively little because prices changed only modestly between average 2023 levels and April 2026.

4.4 What Drives the Increase in Other Food Products and Non-Alcoholic Beverages?

The broad category Other Food Products and Non-Alcoholic Beverages accounts for a substantial share of the increase in grocery costs. To better understand the sources of this increase, the category was decomposed into selected expenditure components that can be matched to more detailed CPI food indexes.

Contribution of Components Within Other Food Products and Non-Alcoholic Beverages
Category Additional_Cost Share
Coffee and Tea 73 34.6
Sugar and Confectionery 50 23.7
Non-Alcoholic Beverages 40 19.0
Prepared Foods 28 13.3
Condiments and Spices 20 9.5
Oils and Fats 1 0.5
Soup -1 -0.5

4.4.1 Contribution to Increased Grocery Costs

4.4.2 Key Findings

The broad category Other Food Products and Non-Alcoholic Beverages contains a diverse set of products with varying expenditure shares and inflation rates. The largest contributors to increased grocery costs were concentrated among beverages, prepared food products, and other processed food items.

This decomposition reveals that the contribution of the broad FD800 category is not driven by a single product group, but rather by the combined effect of multiple food products that households purchase regularly.

5 Income Quintile Results

The national average masks substantial differences across the income distribution. While higher-income households purchase larger grocery baskets and therefore face larger dollar increases, lower-income households experience larger burdens relative to income.

5.1 Food Inflation Burden by Income Quintile

Food Inflation Burden by Income Quintile
inc_quintile Avg_Income Grocery_2023 Grocery_2026 Additional_Cost Burden_Pct_Income
Q1 27178 5620 6112 491 4.03
Q2 56885 7211 7848 637 1.13
Q3 89651 8118 8828 709 0.79
Q4 135117 10085 10978 893 0.67
Q5 242069 12318 13370 1052 0.46

5.2 Additional Annual Food Cost

5.3 Food Inflation Burden as a Share of Income

5.3.1 Key Findings

The estimated additional annual grocery cost ranges from approximately $503 among households in the lowest income quintile to $1,076 among households in the highest income quintile.

However, food inflation is strongly regressive when evaluated relative to income. Households in the lowest income quintile experience an estimated burden of approximately 4.16 percent of income, compared with only 0.47 percent among households in the highest income quintile.

The burden borne by the lowest-income households is therefore nearly nine times larger than that experienced by the highest-income households.

6 Provincial Results

National estimates conceal important provincial differences in food price growth, expenditure patterns, and household incomes. To account for these differences, provincial grocery baskets were repriced using province-specific CPI food indexes.

6.1 Provincial Food Inflation Impacts

Provincial Food Inflation Impacts
GEO Avg_Income Grocery_2023 Grocery_2026 Additional_Cost Burden_Pct_Income
Nova Scotia 93620.21 7960.05 8663.80 703.75 2.07
Saskatchewan 103424.97 9533.72 10574.75 1041.03 2.00
British Columbia 113760.10 8499.57 9322.22 822.65 1.80
Manitoba 100644.13 9620.85 10642.50 1021.65 1.70
Newfoundland and Labrador 103112.92 10924.07 11886.80 962.74 1.69
New Brunswick 89981.22 8477.52 9300.52 823.00 1.54
Alberta 126595.75 10378.13 11474.58 1096.45 1.49
Quebec 98482.63 8836.62 9506.00 669.37 1.36
Ontario 115715.74 7956.80 8592.70 635.90 1.08
Prince Edward Island 91058.00 8319.23 8909.90 590.67 0.82

6.2 Additional Annual Food Cost by Province

6.3 Food Inflation Burden by Province

6.3.1 Key Findings

Provincial differences in food inflation burdens reflect variation in food price growth, household expenditure patterns, and income levels. These results demonstrate that food inflation does not affect Canadian households uniformly and that regional differences remain important for understanding affordability pressures.

7 Conclusion

This study combines household expenditure data from the 2023 Survey of Household Spending and detailed CPI food components to estimate the cost of purchasing the same grocery basket under different price environments.

Four conclusions emerge:

  1. The average Canadian grocery basket increased from approximately $8,668.82 at average 2023 prices to $9,425.22 at April 2026 prices.

  2. The average annual cost increase associated with food inflation was approximately $756.40 per household.

  3. Food inflation is strongly regressive, imposing substantially larger burdens on lower-income households despite larger dollar increases among higher-income households.

  4. Provincial differences in food inflation and household spending patterns generate meaningful variation in food inflation burdens across Canada.

8 Appendix

8.1 CPI Adjustment Factors

Food Category CPI Adjustment Factors
Products.and.product.groups cpi2023 cpi2025 cpi2026 factor2025 factor2026
Bakery products 207.833 209.3 216.5 1.007 1.042
Cereal products (excluding baby food) 175.392 176.3 175.6 1.005 1.001
Dairy products and eggs 169.033 175.9 178.3 1.041 1.055
Fish, seafood and other marine products 163.925 164.8 169.9 1.005 1.036
Fruit, fruit preparations and nuts 167.342 175.8 177.3 1.051 1.060
Meat 204.808 219.2 235.4 1.070 1.149
Other food products and non-alcoholic beverages 172.417 184.7 194.0 1.071 1.125
Vegetables and vegetable preparations 184.717 191.2 198.9 1.035 1.077