When conflict erupts halfway around the world, it can still show up in a Canadian grocery cart.
That’s because Canada’s food system is deeply tied to global markets, from fuel and fertilizer to imported ingredients and export demand. According to University of Alberta Professor Emerita and agricultural economist Ellen Goddard, conflicts rarely stay contained overseas for long.
“We don’t live on a desert island,” said Goddard.
Recent turmoil linked to the war involving Iran has raised concerns about another global food shock as shipping routes, food markets and agricultural inputs all face pressure.
The closure and disruption of the Strait of Hormuz — one of the world’s most important shipping passages, located in the Middle East — has already rattled global supply chains and helped push oil prices higher.
Analysts have warned that the effects are likely to reach supermarket shelves far beyond the Middle East.
Here’s how it happens.
Fuel is the first pressure point
The fastest way global conflict can affect food prices is through energy.
Oil and fuel costs are built into nearly every part of the food system: planting, harvesting, processing, refrigeration and transportation. When oil prices rise, the cost of moving food rises too.
That matters in Canada, where food often travels long distances before it reaches store shelves.
“Fuel is huge in the food supply chain,” said Goddard.
Another major issue is fertilizer, one of the most important inputs in farming.
Canada produces a significant amount of fertilizer, especially potash from Saskatchewan, but it still operates within a global market. If supply tightens elsewhere, Canadian farmers can still end up paying more.
This has happened before. When Russia invaded Ukraine, fertilizer prices jumped because Russia, Belarus and Ukraine are all “major players” in this market, according to Goddard.
In response, Canada imposed tariffs on Russian fertilizer, which added pressure, particularly in Eastern Canada.
Now, new restrictions are raising fresh concerns. Reuters reported this month that China has further restricted fertilizer exports, adding strain to already tight global supplies.
Russia has also been weighing export controls on key commodities as global instability worsens.
“A lot of Canadian farmers, particularly in Alberta, if they’re big enough, will have contracted their fertilizer supplies for the spring last fall,” said Goddard. “But if they need more fertilizer during the growing season, or they need to start locking in prices for the 2027 planting, they’re going to face much higher prices for that.”
Even if farmers can still get what they need, she said, the bigger concern is price.
“I don’t think we’ll be short of supply, because we could keep that supply within Canada. It’ll be the price,” she said. “That’ll be a problem, because that price will be skyrocketing.”
Higher grain costs spread to meat and dairy
The impact doesn’t stop with crops.
If fertilizer becomes more expensive, it can reduce planting or raise grain production costs. That matters because grain is also used as livestock feed. If grain costs rise, meat and dairy costs often follow.
That means a disruption that begins with fertilizer or fuel can eventually affect a wide range of everyday grocery items, from bread and cereal to chicken and beef.
“They are all so interrelated,” said Goddard.
Canada’s food system also heavily depends on cross-border trade with the U.S.
Products, livestock and ingredients move back and forth constantly, especially in industries such as beef and pork.
The open border helps keep the supply chain efficient, but it also leaves the system exposed to political or trade disruptions.
“It’s fine when operating under the Canada-U.S. trade agreement,” Goddard said. “But if we’re going to get that in the future is another source of uncertainty.”
Canada is better positioned, but not immune
Canada does have one major advantage: it is a fuel-producing country.
That means Canadians are less likely to experience severe shortages than people in countries that rely much more heavily on imports. But that doesn’t mean they will be insulated from price hikes.
“If there’s global shortages anywhere of fuel or fertilizer or foods, then there’s an increase in demand for exports from Canada,” Goddard said. “That will push prices up in Canada, because Canadian buyers will need to meet the same prices to get access to the supply.”
In other words, if the rest of the world is willing to pay more for Canadian food, Canadians may also have to pay more for it at home.
Seasonality may offer relief
Goddard explains that, as summer approaches, Canadian-grown fruits and vegetables typically begin to replace more expensive imported produce. That often helps bring down the produce portion of grocery bills, assuming weather conditions cooperate.
Still, that relief is limited. Goddard said that many grocery staples — including rice, spices, coffee, cocoa and sugar — remain vulnerable to global disruptions.
“We’re a bit worried that prices may get higher,” said Goddard.
Goddard explained that fear and uncertainty can lead to retailers buying more aggressively, processors trying to lock in supply, or consumers stocking up.
“We may be stockpiling a bit more when we think it’s a good price. All of those things can contribute to short-term price increases,” she said. “But we have to remember, as with anything with food prices, it’s going to be hugely inequitable.”
For households with higher incomes, a more expensive grocery bill can be frustrating. For lower-income Canadians, seniors on fixed incomes or families already stretched by rent and utility costs, it can be much more serious.
“It just seems to me that it goes from bad to worse most days,” said Goddard. “It’s a bit scary to listen to the news in the morning, because you don’t know what could possibly have happened overnight to make it even worse.”
Goddard said that economists globally looking at grain trade, or looking at society more broadly, have “their fingers crossed that this is short-term and that we may get it resolved at least by the fall, so that we could have more normal flows of product.”
“We’re lucky in that maybe the only thing we’re going to see is price increases. We’re not going to see empty shelves, which some countries will.”
Ellen goddard, agricultural economist
For now, Goddard said Canada is still in a relatively fortunate position compared to countries with fewer domestic resources or less agricultural output.
Between war, shipping disruptions, fertilizer restrictions, trade uncertainty and climate-related crop pressures, farmers are being asked to operate in an increasingly unstable system.
“Farming is risky just to begin with, because it’s weather-dependent to a great extent,” Goddard said. “And then you add wars, and then you add trade barriers, potentially, and then you add tariffs from countries like China, and we’re just dramatically increasing the risks that farmers face.”
For consumers, that may mean a simple but frustrating reality in the months ahead: even if store shelves stay full, grocery bills are likely to remain high.
