Question Period Note: 2026 SPRING ECONOMIC UPDATE (SEU)

Q1 – How did the Spring Economic Update address food insecurity and food affordability amongst Canadians struggling with rising grocery costs?
Q2 – How did the Spring Economic Update address the significant financial challenges facing Canadian producers?
Q3 - How do the CFIA funding announcements in the Spring Economic Update support the agriculture sector?

R1 - The Spring Economic Update highlights several previously announced measures, including immediate targeted financial relief and longer-term structural actions, that aim to reduce the underlying drivers of rising grocery costs, thereby addressing food insecurity and affordability challenges.

Measures directly supporting households include the Canada Groceries and Essentials Benefit, $20 million top-up to the Local Food Infrastructure Fund to support community food provision, making the National School Food Program permanent, and a temporary suspension of the federal fuel excise tax to ease cost-of-living pressures.

To support food security and affordability in the North, an additional $6.3 million for the Northern Isolated Community Initiatives Fund and a $30 million top-up for the Nutrition North Canada Retail Subsidy were also highlighted.

The Government is also reducing costs across the food supply chain by allocating $500 million from the Strategic Response Fund to increase capacity of the agri-food sector, creating a $150 million Food Security Fund for small and medium-sized enterprises, and introducing $41 million over six years for immediate expensing for greenhouse buildings. This is complemented by a stronger food security lens in federal regulation, including $24 million over four years and $9 million annually ongoing for Health Canada to strengthen economic analysis and speed up pest control product reviews.

The Government also proposed to amend the Canadian Food Inspection Agency Act and the Pest Control Products Act to include considerations of food security and the cost of food within the mandates of the Canadian Food Inspection Agency (CFIA) and the Pest Management Regulatory Agency.

The Spring Economic Update reaffirmed the Government’s commitment to developing a National Food Security Strategy. More details will be made available in the coming months; however, key areas of focus will include domestic food production, improving access to affordable and nutritious food, and building resilience and capacity to meet domestic needs.
R2 - As announced on April 1, 2026, and reiterated in the Spring Economic Update, the interest-free limit for the Advance Payments Program was once again increased from $100,000 to $250,000 for non-canola advance for the 2026 program year. This change is expected to provide an average incremental savings of around $4,340 per producer to 8,618 producers for a total savings of up to $37.4 million this program year. As announced in September 2025, in response to the imposition of tariffs on Canadian canola products, the interest-free limit was increased to $500,000 for canola advances for the 2025 and the 2026 program years.
R3 - The Spring Economic Update announced the renewal of the CFIA’s core operational activities. This includes funding ongoing oversight of the Canadian food supply to ensure food safety and disease prevention. The six initiatives include: (1) extending support for African Swine Fever Preparedness and Disease Prevention; (2) extending support for Bovine Spongiform Encephalopathy Prevention; (3) extending support for the Canadian Shellfish Sanitation Program; (4) extending support for the Emergency Response Fund; (5) extending support for Keeping Food Safe; and (6) extending support for Potato Wart Prevention. Renewal of these six initiatives will ensure continued market access for Canadian agriculture and agri-food products, while creating opportunities for growth into new markets by safeguarding Canada’s food, animal and plant resources.

National Food Security Strategy
Food affordability and food insecurity is a major concern for Canadians. Since January 2020, food prices have risen by approximately 30%, compared to a 21% increase in overall consumer prices. Over the same period, household food insecurity increased from 15.8% in 2020-21 to 24.0% in 2024-25, with low-income households being the most affected. Impacts are often greater in rural and remote areas, and Indigenous peoples are disproportionately affected—40% of Indigenous households living off-reserve and 76% of Inuit households in Nunavut experience food insecurity.

In response, on January 26, 2026, the Prime Minister announced the development of a National Food Security Strategy to strengthen domestic food production, improve access to affordable and nutritious food, and build Canada’s resilience and capacity to meet domestic needs.

Alongside the Strategy, the Government introduced a range of targeted measures to help reduce food costs and support Canadians, including:
• The Canada Groceries and Essentials Benefit for more than 12 million Canadians;
• $20 million for the Local Food Infrastructure Fund to ease pressures on food banks;
• $41 million over six years for Immediate expensing for greenhouse buildings to boost domestic supply;
• $500 million from the Strategic Response Fund to address supply chain disruptions;
• $150 million Food Security Fund for small‑ and medium‑sized businesses;
• $36 million to support food security in the North; and
• Making the National School Food Program permanent.
• Temporary suspension of the federal fuel excise tax on gasoline, diesel and aviation fuels.

The Government’s commitment to developing a National Food Security Strategy was reaffirmed in the April 28, 2026, Spring Economic Update, which emphasized the need to address the structural drivers of food affordability. This includes a stronger focus on long-term measures boosting productivity, innovation, and competition to raise incomes and reduce cost pressures within Canada’s supply chains. A key example of this approach is the planned investments of up to $7 billion by 2030 in Canada’s agriculture and agri-food sector through Farm Credit Canada and private partners.
The Spring Economic Update also announced complementary actions to help bring down food costs over the longer term, including:
• Working with provinces and territories to advance standardized unit price labelling;
• Supporting the Competition Bureau; and
• Proposing amendments to the Canadian Food Inspection Agency Act and the Pest Control Products Act to consider food security and food costs, supported by $24 million over four years starting in 2027-28 and $9 million annually ongoing to expand capacity and optimize review processes for pest control products.

Additional details on the National Food Security Strategy will be shared in the coming months.
Advance Payments Program
The Advance Payments Program (APP) is a federal loan guarantee program which provides agricultural producers with easy access to low-interest cash advances. Under the program, producers can obtain cash advances of up to $1 million based on the expected market value of their commodities, thus helping them meet their financial needs, including input costs, over their production and marketing cycle.

To ensure that Canadian farmers have access to the cash flow needed to continue producing food and supporting national food security, the Government increased the $100,000 interest-free limit on loans temporarily under the APP to $250,000 in 2022, to $350,000 in 2023 and to $250,000 in 2024 and 2025, representing a total savings of $226.9 million for producers over the four-year period (2022 to 2025).

On September 5, 2025, it was announced that the interest-free limit will be temporarily increased to $500,000 for canola advances in the 2025 and 2026 program years. It is expected that this program change would provide approximately 1,745 canola producers in program year 2025 and 6,000 canola producers in program year 2026 with a combined $36.3 million ($5.1 million in 2025 and $31.2 million in 2026) in additional interest savings.

On April 1, 2026, it was announced that the interest-free limit was also temporarily increased to $250,000 for non-canola advance for the 2026 program year. This measure is expected to provide approximately 8,618 producers with a combined $37.4 million in additional interest savings for the 2026 program year, with average incremental savings of around $4,340 per producer.

Producers also have access to a suite of business risk management (BRM) programs to help them manage significant risks that threaten the viability of their farms and are beyond their capacity to manage. The suite includes the core programs of AgriInsurance, AgriStability and AgriInvest.

Canadian Food Inspection Agency (CFIA) Spring Economic Update Funding Decisions
The CFIA received funding decisions to renew funding for six initiatives that support core operational business. Renewal of these initiatives will ensure Canada’s continued market access and create opportunities growth into new markets by safeguarding its food, animal and plant resources.

• Extending Support for African Swine Fever (ASF) Preparedness and Disease Prevention: $18.3 million over three years to support efforts to monitor, prevent and prepare for a potential ASF outbreak in Canada.
• Extending Support for Bovine Spongiform Encephalopathy (BSE) Prevention: $67 million over three years to maintain the BSE control program and support maintenance of Canada’s negligible risk status.
• Extending Support for the Canadian Shellfish Sanitation Program: $17.4 million over three years to engage with and support Indigenous communities to safely harvest shellfish for food, social, and ceremonial (FSC) purposes.
• Extending Support for the Emergency Response Fund: $83.7 million over three years to maintain measures to protect human and animal health from ongoing and emergent disease outbreaks including for Highly Pathogenic Avian Influenza (HPAI), Multinucleate Sphere Unknown (MSX), Bovine Tuberculosis, and Dermo.
• Extending Support for Keeping Food Safe: $75 million over five years to maintain funding for key food safety activities.
• Extending Support for Potato Wart Prevention: $18 million over three years to maintain CFIA’s science, testing, and operational capacity to manage potato wart in Prince Edward Island specifically, and Canada overall, and to enable trade continuity.

• The 2026 Spring Economic Update underscores how vital the agriculture and agri-food sector is to Canada’s economy by reinforcing the Government’s ongoing commitment to strengthening its resilience and driving innovation through continued investments and support.

• The Update also highlights the Government’s focus on making food more affordable and accessible for Canadians through targeted relief measures that are already in place and reaffirming the development of a National Food Security Strategy to build a more secure, affordable food system.

• At a time when the Canadian agriculture and agri-food sector is navigating significant pressures and uncertainty, the Government remains committed to ensuring that the sector is competitive and well-positioned to continue feeding Canada and the world.