Key Takeaways:
- Canada’s grocery code of conduct will be implemented on January 1, 2026, to govern the relationship between grocers and their suppliers.
- The code sets guidelines on what costs retailers can pass on to suppliers, including farmers, and provides a dispute-settling mechanism.
- The changes are expected to be "invisible" to consumers, with no significant impact on shopping experiences or food prices.
- The code aims to stabilize the grocery industry and promote fair business practices, but its effects on consumers will be minimal.
- The biggest grocers have signed the agreement, and the focus is now on getting the industry at large, including suppliers, to sign on.
Introduction to the Grocery Code of Conduct
The Canadian grocery industry is on the cusp of a significant change with the implementation of the grocery code of conduct on January 1, 2026. The code is a document that outlines the rules and guidelines governing the relationship between grocers and their suppliers. According to Mike von Massow, a University of Guelph economist, the code sets a set of guidelines around what grocers can ask for and provides a dispute-settling mechanism if suppliers say the grocers are asking for things that are not consistent with the code of conduct. This development is expected to have a significant impact on the industry, but the question remains as to how it will affect consumers.
The Impact on Consumers
One expert is cautioning against expecting dramatic changes in the shopping experience. According to von Massow, the changes to the grocery code of conduct will largely deal with how the grocery business is conducted behind the scenes, with charges and specific costs being governed by the document. When consumers go to the grocery store on January 1, they will not find their experience significantly different. "This is going to be invisible to consumers," von Massow said. The biggest grocers have reassured consumers that the grocery code of conduct will not lead to higher food prices. "The code now is fair, and it will not lead to higher prices," Loblaw CEO Per Bank said in May last year.
The Governance Framework
The Office of the Grocery Sector Code of Conduct announced that it had completed its governance framework, setting the ground for the implementation starting on January 1, 2026. The office also formally launched the recruitment process for retailers and suppliers to sign on, although Canada’s top five grocers — Loblaw, Walmart, Costco, Metro, and Sobeys owner Empire — had already agreed to support the process in July last year. Since then, most of the big grocers have signed the agreement, with Metro becoming the latest signatory last week. "In 2025, we continued our efforts with the Code Office to ensure its success and we look forward to its implementation in the years ahead," Metro CEO Eric La Flèche said.
The Industry’s Response
The agreement is largely expected to impact the way retailers do business with their suppliers, setting guidelines on what costs they can pass on to suppliers, including farmers. During COVID, when grocers were ramping up their online ordering and delivery, some of them said they would charge their suppliers to help fund it, so that they didn’t have to pass those costs on to consumers. Some suppliers said that was not fair, according to von Massow. The focus will now shift to getting the industry at large — including suppliers — to sign on. "With the governance framework in place, we are now focused on supporting broad participation from across the sector," said Karen Proud, president and adjudicator of the Grocery Sector Code of Conduct.
The Long-Term Effects
Over the long run, the grocery code of conduct could potentially affect how quickly new products make it to market or the kind of choice available to consumers. However, for most customers, it will be imperceptible, according to von Massow. "To a significant degree, consumers will not notice that this has been introduced at all," he added. The biggest grocers have reassured consumers that the grocery code of conduct will not lead to higher food prices. "Given that the retailers are saying it’s not going to be inflationary, my expectation is we won’t see this affecting food prices significantly," von Massow said. The code aims to stabilize the grocery industry and promote fair business practices, but its effects on consumers will be minimal.