Canada’s anti-trust watchdog is to study competition across the country’s food-and-drinks supply chain.

The country's Competition Bureau cited a "sharp" rise in food prices in Canada in recent years that had "put significant pressure" on consumers.

The watchdog’s review will assess three parts of the chain: production and processing; transport and distribution; and retail pricing practices.

Jeanne Pratt, interim commissioner of competition at the Competition Bureau, said: “Our examination builds on our earlier work in the retail grocery sector and will look at all parts of the food supply chain.”

In 2023, the competition watchdog called for increased competition in Canada's grocery market, pointing to the difficulty new retailers face in entering the market.

The bureau has invited views from members of the public and organisations with experience of the food supply chain. A final report is due in the first half of next year.

In January, the Canadian government outlined a series of measures aimed at easing food inflation pressures on households and supporting businesses across the food supply chain.

Those initiatives included a mix of direct payments to lower-income households, support for businesses and longer-term structural reforms.

Canada is set to publish its inflation data for May next week. In April, the country's Consumer Price Index increased 2.8% year-on-year following a 2.4% rise in March.

The announcement of the Competition Bureau's new review comes less than a week after Canada introduced a food security strategy to boost local food production.

Ottawa wants to reduce Canada’s reliance on imports, foster competition in the grocery sector and cut red tape in the agriculture supply chain.

Under the strategy, the Government said it would invest in fruit and vegetables production, including through controlled environment agriculture, or vertical farming, where crops can be grown year-round.

As part of the food production plan, C$1bn (US$710m) would be funnelled into a new Agri-food Project Finance Fund to be managed by Farm Credit Canada (FCC) to disperse financing to businesses.

A Food Security Fund will also be established with initial capital of C$150m to “help small and medium-sized businesses upgrade their equipment to grow, produce, and process more food in Canada”.

It will be accompanied by a C$100m Collaborative Food Innovation Fund to help foster expansion in agri-food processing.