Canada could add billions to its GDP and create thousands of jobs if a small slice of crop exports are kept at home for processing in domestic plants, according to a new report commissioned by Protein Industries Canada.
“We have so many abundant crops that we grow from coast to coast, so we can do better,” Protein Industries Canada CEO Tyler Groeneveld said in an interview with CBC.
“We can create more consumer packaged goods and ingredients that can be on supermarket shelves here in Canada, but also have significant capacity to feed a hungry world that’s looking for nutrient dense, high protein, high fiber ingredients.”
The reports suggests that “redirecting just 10 per cent of Canada’s raw crop exports to domestic value-added processing could generate up to $5.4 billion in additional GDP” and up to $1.1 billion in government revenue, while creating about 34,000 full-time equivalent jobs.
Protein Industries Canada, a Regina-based agri-food trade group, hired Ernst & Young LLP to prepare the analysis, which was released Sept. 22 during the Plant Forward trade show in Saskatoon.
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The report targeted four sectors in its analysis: human food, animal feed, ingredient processing and bio-industrial applications.
The potential downstream bio-industrial uses of Canadian crops and agriculture byproducts include making biopolymers and lubricants from oilseeds, resins for 3-D printing, biodegradable packaging and pharmaceuticals.
The report also examined potential food processing spin-off opportunities: aquaculture feed, rations for the military and disaster relief operations, and ingredient manufacturing for processed food and drinks.
“The economic opportunities for Canada just in ingredient processing alone are so big,” Groeneveld said. “Food and beverage is huge. That’s a $9.8-trillion market by 2040.”
Food is the largest manufacturing industry in Canada, employing more than 350,000 people in almost 10,000 plants, said Michael Graydon, CEO of Food Health and Consumer Products of Canada, a trade association for food manufacturers.
He wants to see more capital investment into agri-food to keep more food production at home.
“We export over $700 million of commodity tomatoes out of this country and we import $500 million worth of canned and processed tomato products back into the country,” Graydon said.
“The commodity sales stays the same whether it’s domestic or international. We’ve lost the job opportunities in regards to converting those tomatoes into sauces and other products.”
The report suggested that agri-food sector growth is hampered by regulatory and supply-chain inefficiencies, transportation bottlenecks at rails and ports, “policy fragmentation” that creates internal trade barriers, and a workforce facing mass retirements by 2030 and a skill shortage.
The food and agriculture sector in 2024 was worth about $149.2 billion, or about seven per cent of national GDP, and supported 2.3 million jobs, according to the report. About 70 per cent of Canada’s annual crop production consists of wheat, canola and corn.
The report suggests now — as Canada seeks to diversify its economy and international trade partners while strengthening domestic supply chains to be less reliant on the U.S. — is the time to dedicate resources to expanding the industry.
In 2024, Canada shipped 88 per cent of its food exports to the U.S., according to the report. The U.S. and China are the biggest importers of Canada’s crops and agriculture products at 32 per cent and 18 per cent, respectively.
Louis Dreyfus Company Canada president Brian Conn agrees with the report’s assessment of potential for growth in agri-food. The company operates a canola crushing and pea processing plant in Yorkton.
“We’re very bullish on the opportunity, not just with oils and fats with our canola processing business, but also on protein demand going forward,” Conn said.
“Being at the right origin is extremely important. Working with growers in Western Canada, specifically Saskatchewan and our Yorktown facility, gives us a real competitive advantage.”
Graydon said Saskatchewan should play a big role in growing the agri-food industry.
“Given the wealth of agricultural output, this should be an area where there is more capital investment in manufacturing,” he said.
“When you look at food, value-added manufacturing is becoming very sophisticated…. These are high-paying technical jobs that really have a significant impact on the economies of the communities where these manufacturing facilities are built.”
The report’s recommendations include creating a scientific advisory body for “novel agri-food products,” developing accelerator programs and investor roundtables to encourage private capital investment, and building regional cold-storage and pre-processing hubs to ensure consistent feedstock supplies.
The report also suggests launching a two-province pilot project that would see an agreement on “mutual testing, certification and documentation requirements” to break down inter-provincial trade barriers.
