The food and beverage processing sector is a major contributor to the Canadian economy as a supplier of food, a market for agricultural production, and a source of economic growth. Since the 1960s the sector experienced substantial growth due to rising population and income levels, and lifestyle changes that emphasized convenience. However, increasing global economic integration since the mid-1980s, particularly in North America, compelled the sector to shift its focus from the domestic market and develop a more international, export orientation. This sector has significantly contributed to the provision of reasonably priced food to consumers, a remarkable achievement given the geographic distances, the diversity of markets and the climatic hurdles in Canada. In fact, relative to other developed nations, Canadian spending on food as a share of personal disposable income ranked second lowest after the United States.

Canada's food and beverage processing sector, in terms of its relative size, trade, and processing intensity, is similar to those in other large industrial countries. Domestically, food and beverage processing is the third largest manufacturing sector, accounting for 11.8% of manufacturing gross domestic product (GDP) and about 2% of total GDP in 1996 (Figure 1). The sector produced shipments valued at $52 billion in 1996 and provided 234,000 jobs (Table 1). The statistics used to describe the size and sig-

Other Meat/poultry Dairies Breweries Fruits/vegetables Bakeries Soft drinks Sugar/confectionery* Flour/cereal/feed Distilleries Oil mills* Wineries*

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