As various industries pass rising fuel costs to customers, one of Canada's largest meat-processing companies has announced it is following suit. Maple Leaf Foods CEO Curtis Frank confirmed the company is adding a temporary fuel surcharge to offset higher transportation expenses linked to the Middle East conflict.
Fuel Surcharge Explained
“Geopolitical developments, including the conflict involving Iran, are affecting energy markets and increasing transportation costs in the near term,” Frank said Thursday on an earnings call, according to The Canadian Press. “This provides transparency around the underlying drivers of those increases and will be removed if or as fuel markets normalize.”
Strait of Hormuz Disruption
The U.S. war with Iran has led to the closure of the Strait of Hormuz, a critical chokepoint for global oil shipments. Tanker traffic from the Persian Gulf remains stalled, impacting about 20% of the world's oil supply and keeping oil prices elevated. Although negotiations to end the war are ongoing, prices remain significantly higher than pre-conflict levels.
Previous Price Increases
In February, the Mississauga-based company raised prices by approximately 11 cents per kilogram, or about four cents per package of hotdogs and bacon, as reported by CP.
Strong Sales Despite Higher Costs
Despite the surcharge, Maple Leaf Foods reported robust sales for the first quarter of 2026. Poultry sales rose 11.7%, and prepared foods sales increased 2.3% compared to the same period last year. Total first-quarter sales reached $962.9 million, up 6.2% from $906.7 million in 2025.
Frank attributed the strong poultry sales to its affordability relative to other proteins like beef, according to CP.
Read more: CHARLEBOIS: Iran war and the Strait of Hormuz -- when geopolitics becomes grocery bills; CHARLEBOIS: Why a ceasefire won’t cool your grocery bill.
