The 2026 FCC Food and Beverage Report states sales among food and beverage manufacturers are predicted to rise by 0.8 per cent while volumes fall by 0.7 per cent, the fourth straight year of decline. It notes sales growth will likely be driven by higher prices, not higher consumption.

WHY IT MATTERS: With trade tensions still disrupting global supply, prices could fluctuate this year, affecting consumers’ choices.

FCC chief economist Craig Johnston said this disparity speaks to the issue of consumer purchasing power.

“Higher food prices over the past several years are really weighing on households’ budgets,” he said in an interview. “They’re making more cost-conscious decisions.”

“This is actually a headwind for consumption and a headwind for volumes.”

He said any upstream changes will no doubt filter down to Canadian producers. Some challenges are shared across sectors.

“When we think about common elements, you can think about the tariffs, the elevated input costs, generally,” he said.

Margins are tight across the sector, including for farmers.

“We’re not seeing massive improvements on margins within the food and beverage manufacturing sector to pre-COVID levels, and we’re not necessarily seeing that filter through to a broad-based increase in margins for primary ag.”

“The industry in general is still going through this adjustment period” he said, “and we do expect that to continue to 2026.”

Trade tensions still a factor

Canada will continue to grapple with trade uncertainty this year, including the recent instability caused by the conflict in the Middle East.

Forecasts for costs of goods in the Food and Beverage Report were made before the crisis, “meaning that if the commodity price surge persists beyond just a few months, there would be upside risks to those estimates.”

FCC had expected pressures on some inputs, such as cattle and hogs, to ease from 2025 highs, but surging energy prices due to the conflict make that less likely.

Costs of production up

Production costs for food and beverage manufacturers increased by two per cent in 2025, driven mostly by raw material costs.

“The increase in raw material costs was driven by disruptions that constrained availability and raised prices,” the report states.

“Some examples from 2025 include avian influenza impacts on poultry … tariffs that increased the cost of imported aluminum packaging and historically low cattle herd sizes across North America.”

Costs across sectors

The report also breaks down costs associated with sub-sectors of food and beverage processing.

In grain and oilseed milling, sales were uneven in 2025 but improved by the fourth quarter. 2026 shows signs of a rebound in sales and volumes.

Large carryover of canola stocks is expected to keep prices under pressure in 2026. Canola prices are expected to fall by 3.1 per cent in 2026.

The report suggested demand for Canadian maple syrup and honey has continued to increase in the global market.

In the dairy sector, 2026 will likely see a 3.6 per cent increase of product manufacturing sales over 2025. Processors are also expected to pass along costs from the producer price increase for unprocessed milk to consumers.

In the meat manufacturing sector, FCC forecasts sales up 1.6 per cent and volumes down by 5.6 per cent.

Tight supplies of live animals, due largely to disease outbreaks, drove prices up in 2025. According to the report, “2026 will likely see another year where price, not volume, drives sales upward.”

The post Food and beverage sales growth, volume decline predicted for 2026 appeared first on Manitoba Co-operator.

The FAO Food Price Index, which tracks a basket of globally traded food commodities, averaged 124.3 points in December, down from 125.1 in November and 2.3 per cent lower than a year earlier.

For the full 2025 year, the index averaged 127.2 points, up 4.3 per cent from 2024, led by higher vegetable oil and dairy prices, while cereal and sugar quotations fell.

— Reporting by Sybille de La Hamaide

The post World food prices extend fall in December, UN’s FAO says appeared first on Manitoba Co-operator.

The FAO Food Price Index, which tracks a basket of internationally traded food commodities, averaged 128.8 points in September, down from a revised 129.7 in August.

The index was up 3.4 per cent on the same month last year, though nearly 20 per cent down from a record level in March 2022 following Russia’s full-scale invasion of Ukraine.

Lowest sugar prices since March 2021

The indicator, which had climbed to a two-year peak in July before stabilizing in August, was curbed last month by a 4.1 per cent drop for FAO’s sugar price index, which reached its lowest since March 2021.

The fall for sugar reflected an improving supply outlook, with higher than expected production in Brazil and favourable harvest prospects in India and Thailand, FAO said.

The agency’s dairy price index slipped 2.6 per cent month on month, driven in turn by a sharp decline in butter prices amid increased production prospects in Oceania.

FAO’s cereal benchmark saw a 0.6 per cent decline from August, with wheat prices dropping for a third straight month due to large harvests and subdued international demand.

Corn (maize) prices also decreased, partly pressured by a temporary suspension of export taxes in Argentina.

The agency’s rice index also showed a monthly fall as reduced orders by buyers in the Philippines and Africa weighed.

U.S. beef market drives record meat prices

Vegetable oil prices fell by 0.7 per cent as lower palm and soybean oil quotations offset increases for sunflower and rapeseed oil.

In contrast, FAO’s meat price indicator rose by 0.7 per cent to a new record high as beef and sheep meat quotations rose.

Beef prices also reached a new peak, supported by strong demand in the U.S. amid limited domestic supply.

In a separate report, the FAO increased its forecast for global cereal production in 2025 to 2.971 billion metric tons from 2.961 billion tons projected last month.

The latest outlook was up 3.8 per cent from 2024 output, marking the largest annual increase since 2013, it said.

The upward revision was attributed to higher production prospects for wheat, corn and rice.

— Reporting by Gus Trompiz

The post World food prices dip as falls in sugar and dairy offset new high for meat appeared first on Manitoba Co-operator.

The FAO Food Price Index, which serves as a global benchmark for food commodity prices, averaged 130.1 points in July, a 1.6 per cent increase from June, FAO said.

That was the highest reading since February 2023, though the index was 18.8 per cent below its peak of March 2022, which followed Russia’s full-scale invasion of Ukraine.

Meat price index hits all-time high

FAO’s meat price index hit a new all-time high of 127.3 points, up 1.2 per cent from its previous peak in June, as strong import demand from China and the United States boosted beef and sheep meat prices, the agency said.

U.S. beef imports have climbed after drought led to a decline in the domestic cattle herd. China shipped in record amounts of beef last year amid growing popularity of the meat, though an official probe into imported beef has raised uncertainty about Chinese demand.

In other meat markets, poultry prices rose slightly following the resumption of imports of Brazilian chicken by major buyers after Brazil regained its avian influenza-free status following action against a first farm-level outbreak.

In contrast, pork prices declined due to sufficient supplies and lower demand, particularly in the European Union, FAO added.

Vegetable oil index up

The agency’s vegetable oil index surged to 166.8 points, up 7.1 per cent month-on-month and the highest level in three years.

This increase was driven by higher quotations for palm, soy, and sunflower oils due to robust global demand and tightening supplies, though rapeseed oil prices fell as new-crop supplies arrived in Europe, FAO said.

FAO’s cereal price benchmark eased to its lowest in almost five years, reflecting seasonal supply pressure from wheat harvests in the Northern Hemisphere.

Its separate rice index dropped 1.8 per cent last month, driven by ample export supplies and weak import demand.

Dairy prices edged down for the first time since April 2024, with declines for butter and milk powders offsetting further gains for cheese.

FAO’s sugar price index eased for a fifth consecutive month on expectations of increased production in Brazil and India, despite indications of recovering global sugar import demand, the agency said.

FAO did not update its cereal supply and demand estimates this month.

— Reporting by Gus Trompiz

The post World food prices at two-year high on rising meat and edible oils, FAO says appeared first on Manitoba Co-operator.

The FAO Food Price Index, which tracks monthly changes in a basket of internationally traded food commodities, averaged 128.0 points in June, up 0.5 per cent from May. The index stood 5.8 per cent higher than a year ago, but remained 20.1 per cent below its record high in March 2022.

Cereals mixed, vegetable oils up

The cereal price index fell 1.5 per cent to 107.4 points, now 6.8 per cent below a year ago, as global maize prices dropped sharply for a second month. Larger harvests and more export competition from Argentina and Brazil weighed on maize, while barley and sorghum also declined.

Wheat prices, however, rose due to weather concerns in Russia, the European Union, and the United States.

The vegetable oil price index rose 2.3 per cent from May to 155.7 points, now 18.2 per cent above its June 2024 level, led by higher palm, rapeseed, and soy oil prices.

Palm oil climbed nearly five per cent from May on strong import demand, while soy oil was supported by expectations of higher demand from the biofuel sector following announcements of supportive policy measures in Brazil and the United States.

Sugar prices dropped 5.2 per cent from May to 103.7 points, the lowest since April 2021, reflecting improved supply prospects in Brazil, India, and Thailand.

Meat prices rise

Meat prices rose to a record 126.0 points, now 6.7 per cent above June 2024, with all categories rising except poultry. Beef set a new peak, reflecting tighter supplies from Brazil and strong demand from the United States. Poultry prices continued to fall due to abundant Brazilian supplies.

The dairy price index edged up 0.5 per cent from May to 154.4 points, marking a 20.7 per cent annual increase.

In a separate report, the FAO forecast global cereal production in 2025 at a record 2.925 billion tonnes, 0.5 per cent above its previous projection and 2.3 per cent above the previous year.

The outlook could be affected by expected hot, dry conditions in parts of the Northern Hemisphere, particularly for maize with plantings almost complete.

The post World food prices tick higher in June, led by meat and vegetable oils appeared first on Manitoba Co-operator.

The index, compiled by the U.N. Food and Agriculture Organization (FAO) to track the most globally traded food commodities, fell to 127.0 points last month from a slightly revised 127.6 in November.

The November figure was previously put at 127.5.

The December value was up 6.7 per cent from 12 months previously, yet remained 20.7 per cent below the all-time high reached in March 2022, FAO said.

For 2024 as a whole, the index averaged 122.0, 2.1 per cent lower than the 2023 value, offsetting significant decreases in quotations for cereals and sugar with smaller increases in prices for vegetable oils, dairy and meats.

Sugar prices led December’s monthly decline, dropping 5.1 per cent month-on-month thanks to improving sugarcane crop prospects in the main producing countries to stand 10.6 per cent below its December 2023 level.

Dairy prices declined after seven consecutive months of increases, losing 0.7 per cent from November but still posting a 17.0 per cent gain year-on-year. Vegetable oil prices dropped 0.5 per cent month-on-month, but were up 33.5 per cent on their year-earlier level.

Meat prices rose 0.4 per cent in December from November and stood 7.1 per cent above their December 2023 value.

The FAO cereal price index was little changed last month from November and was 9.3 per cent below its year-earlier level, as a slightly uptick in maize quotations offset a drop in those for wheat, FAO said.

FAO did not provide a new forecast for global cereal production, with the next estimate due next month.

The post World food price index eases in Dec, pushed lower by sugar appeared first on Manitoba Co-operator.

The price index, compiled by the U.N. Food and Agriculture Organization (FAO) to track the most globally traded food commodities, increased to 127.5 points last month from a revised 126.9 points in October, the highest level in 19 months and up 5.7 per cent from a year ago.

The vegetable oil index jumped 7.5 per cent above levels seen a month ago and 32 per cent above those seen a year earlier, driven by concerns over lower than expected palm oil output due to excessive rainfall in Southeast Asia.

Soyoil prices rose on stronger global import demand, while rapeseed and sunflower oil also increased.

Other food price indexes declined.

Cereal prices dropped 2.7 per cent from October thanks to weaker wheat and rice prices, while sugar fell 2.4 per cent from October as India and Thailand began crushing and concerns over Brazil’s crop prospects eased.

In a separate report, the FAO trimmed its forecast for global cereal production in 2024 from 2.848 billion metric tons to 2.841 billion, a 0.6 per cent decline from last year but still the second largest output on record.

World cereal utilisation, meanwhile, is set to increase 0.6 per cent to 2.859 billion tons in 2024/25 thanks to growing consumption.

As a result, the FAO expects the cereal stocks-to-use ratio to fall to 30.1 per cent at the close of the 2025 season from 30.8 per cent previously, but still indicating a “comfortable level of global supply”.

— Reporting by Maytaal Angel

The post World food prices reach 19-month high in November, UN says appeared first on Manitoba Co-operator.

The Food and Agriculture Organization’s (FAO) index, which tracks the most globally traded food commodities, averaged 118.3 points in March, up from a revised 117.0 points the previous month, the agency said on Friday.

The February reading was the lowest for the index since February 2021 and marked a seventh consecutive monthly decline.

International food prices have fallen sharply from a record peak in March 2022 at the start of Russia’s full-scale invasion of fellow crop exporter Ukraine.

The FAO’s latest monthly reading was 7.7 per cent below the year-earlier level, it said.

In March, the agency’s vegetable oil price index led gains, jumping 8 per cent month on month, with all major oils registering increases.

The dairy index gained 2.9 per cent for a sixth straight monthly rise, driven by cheese and butter prices, while the FAO’s meat index added 1.7 per cent, reflecting higher poultry, pig and beef prices.

Those gains outweighed declines for cereals, which shed 2.6 per cent from February, and for sugar, which fell 5.4 per cent.

Wheat led the decline in cereals amid strong export competition and cancelled purchases by China, offsetting a slight rise for maize (corn) prices partly due to logistical difficulties in Ukraine, the FAO said.

Weaker sugar prices mainly reflected an upward revision to expected production in India and an improved harvest pace in Thailand, it said.

In separate cereal supply and demand data, the FAO nudged up its forecast for world cereal production in 2023/24 to 2.841 billion metric tons from 2.840 million projected last month, up 1.1 per cent from the previous season.

For upcoming crops, the agency trimmed its forecast for 2024 global wheat output to 796 million tons, from 797 million last month, due to reduced expectations for European Union and UK crops following rain-hit sowing and dry conditions in some areas.

For maize, a fall in world production was anticipated but the volume would remain above the average of the past five years, the FAO said, without giving a precise forecast.

—Reporting for Reuters by Gus Trompiz

The post World food prices rebound from three-year low, says UN agency appeared first on Manitoba Co-operator.