Five Weeks After Canada’s 25% U.S. Cheese Tariff, Tracked Grocery Flyer Prices Are Down 0.2%

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Five weeks after Canada imposed a 25% tariff on American-made cheese, early grocery pricing data are challenging expectations of an immediate jump at the checkout. According to an October 12, 2026, update from Canadian grocery-price tracker CartIQ, advertised prices for 199 matched cheese products have declined by a median of 0.2% compared with their pre-tariff levels.

The finding comes amid renewed trade tensions between Ottawa and Washington, with both countries imposing tariffs on billions of dollars in goods. Yet the modest movement in cheese prices raises an important question: why has a substantial import duty not produced a noticeable increase across the dairy aisle?

The answer involves domestic production, retailer promotions, existing inventories and the difference between a tariff imposed at the border and prices paid by households.

Cheese Prices Have Barely Moved After Five Weeks

Canada’s latest counter-tariffs took effect on September 8, 2026. By October 12, CartIQ’s grocery-price tracker had collected 21 weeks of promotional pricing information covering 32 Canadian grocery chains. Its analysis identified 199 cheese item-and-retailer matches that could be compared before and after the tariffs began. The median price change was negative 0.2%, suggesting little movement in the advertised prices of products consistently appearing in the dataset. That is a notably subdued early result for a category facing a 25% import duty on American-made products.

The underlying numbers tell a more complicated story than the headline alone. Among matched cheese listings, 21% recorded increases exceeding 0.5%, while 25% registered decreases of more than 0.5%. The remaining products showed smaller movements. Importantly, the analysis did not isolate American-made cheese, so the result cannot establish whether tariffed imports themselves became cheaper or more expensive. It measures a broader selection of advertised cheese prices. Nevertheless, it provides a useful early indication that a substantial tariff has not translated into a widespread increase in tracked flyer offers.

Canada’s 25% Tariff Targets American-Made Cheese

The September measures were introduced after Washington imposed 50% tariffs on approximately $27.6 billion in Canadian goods in August. Ottawa responded with counter-tariffs covering an equivalent value of American imports, applying rates of 15%, 25% and 50% depending on the product. Cheese was among the most recognizable grocery categories included in the response. Government tariff schedules confirm that American-origin mozzarella, cheddar, brie, gouda, parmesan, processed cheese and other varieties became subject to the additional 25% duty.

Crucially, the tariff does not apply to every package of cheese sold in Canada. A block manufactured domestically is not subject to the Canadian counter-tariff simply because its producer also operates factories in the United States. Origin matters more than the corporate headquarters printed on the packaging. Other food-related tariffs also exist, including 50% duties on specified milk powders, whey products, natural honey and molasses. However, many ordinary grocery categories, including fresh produce, meat, coffee and fluid milk, are outside this particular round of Canadian countermeasures. This targeted structure helps explain why the overall grocery impact may remain limited.

Grocery Flyers Tell a Different Story From Checkout Receipts

CartIQ’s analysis does not measure every transaction made at Canadian supermarkets. Instead, it examines advertised promotional prices collected from retailer flyers. To qualify for the comparison, a product-and-chain combination needed to appear at least twice during the eight weeks before September 8 and at least once afterward. The tracker then compared each item’s median advertised price across the two periods, using the median of those individual changes to produce its headline figure. This approach reduces the influence of changing product selections and occasional unusually steep discounts.

Still, grocery promotions can create substantial short-term price fluctuations. A cheese block might appear in one week’s flyer as part of a multi-buy offer and return at a higher advertised price the next week without any tariff-related change in the underlying cost. CartIQ’s broader database contains 81,751 classified price records through October 12, but those records do not reveal the prices of every item purchased by households. The methodology also does not fully establish each product’s country of manufacture. Consequently, the 0.2% decline is best understood as an early promotional-pricing indicator, not proof that Canadian grocery bills or American cheese prices have fallen.

Untariffed Dairy Products Show Almost No Price Changes

One of the more revealing findings is that cheese has behaved much like dairy products that were never targeted by the September tariffs. CartIQ compared cheese with several everyday staples over the same period. Milk recorded a median advertised-price change of 0.0% across 32 matched items. Butter also remained unchanged across 36 matches, while yogurt registered 0.0% across 137. Even eggs, tracked separately across 40 matches, showed no median movement. Cheese’s negative 0.2% reading therefore stands remarkably close to the results for these untariffed foods.

The comparison matters because it helps distinguish broad pricing conditions from changes specific to imported cheese. If higher customs duties were already pushing advertised cheese prices upward across the category, a sustained difference between cheese and untariffed dairy products might eventually appear. No such clear separation is visible in the first five weeks. However, these controls cannot establish causation on their own. Cheese contains both imported and domestic varieties, and different products follow different promotional schedules. The current similarity is reassuring for shoppers, but it remains an observation rather than proof that tariffs have no effect.

Canada’s Domestic Cheese Industry Limits U.S. Exposure

Canada produces far more cheese than it imports, providing a natural buffer against additional duties on American products. Agriculture and Agri-Food Canada reports that domestic production of natural cheese reached 515,033 metric tonnes in 2025. By comparison, total cheese imports amounted to 63,947 tonnes, with approximately 35% arriving from the United States. That puts American shipments at roughly 22,000 tonnes, a relatively small volume compared with domestic production. Canadian processors such as Saputo, Agropur and Lactalis Canada operate alongside numerous smaller cheesemakers, supplying consumers with a wide range of alternatives.

This balance helps explain why the tariff may have a limited impact on typical grocery promotions. CartIQ found that just 5.9% of its cheese listings carried the name of an American-parented brand, although that figure is not a reliable measure of American-made products. Some international brands manufacture their cheese in Canada and are therefore unaffected by the duty. A tariff on a particular imported mozzarella or cream cheese can still matter to consumers who regularly buy it. But the effect on an entire dairy aisle can be considerably smaller when domestic products account for most available supply.

Retailers May Not Pass Along Tariff Costs Immediately

Experience from Canada’s previous tariff dispute provides a reason to avoid declaring victory over higher prices too early. Bank of Canada researchers studied daily online prices for more than 110,000 products at seven major retailers during 2025. They found that goods subject to Canada’s 25% counter-tariffs became approximately 6% more expensive than comparable untariffed products, with the difference developing over roughly three months. In other words, only about one-quarter of the tariff rate appeared in consumer prices during the period studied, and the increase was gradual rather than immediate.

Retailers have also warned that existing inventory can delay the impact of new duties. In September 2026, Loblaw chief executive Per Bank explained that stores would first sell products already in stock before reflecting additional tariff-related costs. Some merchandise could take weeks or months to show visible changes. Suppliers might also adjust prices, absorb some costs or switch sourcing arrangements to remain competitive. These possibilities help explain why five weeks of relatively stable flyer pricing cannot settle the issue. If historical patterns repeat, later autumn pricing could provide a clearer picture than the first weeks after implementation.

Grocery Bills Can Still Rise While Cheese Prices Remain Stable

Relatively stable cheese promotions do not mean Canadians have escaped higher food costs. Statistics Canada’s latest available Consumer Price Index report, covering August 2026, showed grocery prices increasing 2.8% from a year earlier. Overall inflation stood at 3.0%, while dairy prices rose just 0.7% annually, down from 3.1% in July. Cheese and yogurt were important contributors to that slowdown. The figures suggest dairy prices were already showing signs of moderation before September’s counter-tariffs took effect, although the August data cannot measure the impact of the new policy.

For households, slower inflation offers limited comfort when prices remain elevated. Statistics Canada reported that grocery prices were 29% higher in August 2026 than five years earlier. Agriculture and Agri-Food Canada separately found that cheese prices increased 16% between 2021 and 2025. Families purchasing groceries every week still encounter the accumulated increases from previous years, regardless of modest recent changes. A stable cheese special might help stretch a household budget, but it cannot offset every increase elsewhere in the shopping cart. The distinction is important: slowing price growth does not mean a return to earlier, lower prices.

The 2026 Tariffs Are Different From Canada’s 2025 Trade Measures

Much of the public concern about tariffs and groceries comes from the broader trade dispute that unfolded in 2025. Beginning in March of that year, Canada imposed 25% counter-tariffs on numerous American products, including orange juice, peanut butter, coffee, beer and other consumer goods. Those measures affected a much wider selection of everyday purchases than the food-related provisions introduced in September 2026. Ottawa removed the earlier counter-tariffs on most American imports on September 1, 2025, while maintaining separate measures on steel, aluminum and automobiles.

The distinction matters when assessing today’s grocery risks. American orange juice, peanut butter and coffee are not included in the September 2026 counter-tariff schedule, despite their prominence during the previous dispute. The current measures concentrate additional duties on specified products, including cheese and certain dairy ingredients, alongside extensive industrial and manufactured goods. Some costs could still reach consumers indirectly through tariffed ingredients or packaging materials. Nevertheless, economists interviewed by The Canadian Press in September expected limited effects on most groceries because alternative Canadian suppliers were available. Understanding which goods actually face duties is essential before attributing an increase in shelf prices to the trade dispute.

Grocery Chains Are Bringing Back Tariff Warning Labels

Canadian retailers have responded to the renewed trade dispute by making product origins and tariff exposure more visible. In August 2026, Loblaw announced the return of its T symbol, used to identify imported American products experiencing tariff-related price increases. The company also maintained its maple leaf labels highlighting food prepared in Canada. Other major grocers, including Sobeys and Metro, emphasized their efforts to promote Canadian-made alternatives. Loblaw said it would seek to limit additional costs before passing unavoidable increases to customers.

The labels have an interesting relationship with pricing behaviour. Bank of Canada researchers found that during the 2025 tariff episode, affected products carrying visible tariff labels experienced larger and faster price increases than comparable tariffed products without them. That relationship does not establish that the labels themselves caused the increases, but it suggests transparency, consumer expectations and retailers’ pricing decisions can interact. For shoppers, the distinction between a product made in the United States and one sold by an American-owned company is particularly important. A tariff label can help identify exposure, while the country-of-origin information provides a clearer explanation of why a specific product may be affected.

The Next Several Weeks Will Provide a Better Test

The first five weeks offer an encouraging observation, but the more meaningful test will unfold as retailers replenish inventories and negotiate new supplier prices. CartIQ plans to continue updating its grocery-price comparisons, allowing researchers and consumers to see whether cheese begins moving differently from milk, butter and other untariffed staples. Statistics Canada’s September Consumer Price Index report is scheduled for October 19, providing another perspective on grocery inflation, although it will not fully capture the longer-term effects of the September 8 measures.

The strongest evidence would come from comparing confirmed American-made cheese with equivalent Canadian products over several months, alongside actual transaction prices rather than promotional listings alone. Changes in tariff policy, inventory levels and retailer sourcing would also need to be considered. For now, the 0.2% decline indicates that the new duty has not produced a broad, immediate increase in the cheese promotions tracked by CartIQ. It does not establish that every affected product is insulated from higher costs. The outcome may ultimately be modest because of Canada’s substantial domestic cheese industry, but a definitive assessment requires more time. Whether prices remain stable into December will be a more revealing measure of the tariff’s consumer impact.

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