We have a huge problem across Canada's food manufacturing sector, and this is not going to be a short-term crisis. We are facing a new normal of extraordinary cost pressures that we have to address somehow, either by means of government support or through food price increases. Right now, in the immediate term, there is really no relief for these companies.
First, most food companies or food manufacturers are not qualifying for the COVID emergency relief programs. Programs like the Canada emergency wage subsidy are based on revenue losses. Of course, we are still selling food, so our revenues haven't fallen. What has happened, though, is that our costs have skyrocketed, because of the elements James talked about. What we really need is for these emergency programs to look at the impact on net income and use that as the real measure of loss.
The other problem we have is that it's virtually impossible in this country for food and beverage manufacturers to pass cost increases on in the best of times, and certainly not costs of this magnitude. Our retail sector is very strong and very concentrated. It creates an imbalance of power that is very challenging, particularly for small and mid-sized companies. Just last Friday, with no advance notice, one of the major retailers in this country sent an announcement to food companies about immediately imposing penalties related to delivery issues.
We know there was an announcement early this week from the Prime Minister of $77.5 million. As James pointed out, we estimate the cost of adapting to COVID-19 to be over $800 million. More to the point, the announcement this week really isn't designed to address these cash crunch or liquidity issues. It has been designed more to allow for investments by food companies.
The ongoing pressures we're facing are undoubtedly going to destroy some companies and drive them into bankruptcy. Food availability, food affordability and food sovereignty are all going to be impacted. Canadians will still eat, so, frankly, if we do nothing, what we will see is that more and more of our grocery shelves will be filled with products that come from offshore.
What do we do? On February 24, 14 food processor associations essentially representing the entire industry wrote to the Prime Minister and the federal Minister of Agriculture to highlight our concerns. We suggested that the federal government give serious consideration to expanding the existing emergency programs so they are better suited for the companies in our industry really facing liquidity pressures. We also suggested that the federal government look at more creative measures, for example tax credits, for companies to offset the additional costs of COVID-19, at a minimum.
Looking forward, we have to take a serious look at how our food system is structured and supported. This pandemic has magnified the importance and fragility of the food system. It has also highlighted some significant weaknesses. We will not be solving these issues with short-term business-as-usual approaches.
I note the announcement this morning by Minister Bains of a new industry strategy council to look at the impact of COVID-19. I sincerely hope that council includes someone from Canada's largest manufacturing sector who really understands how food processing and the food system work.
I want to close with probably the most important message I can deliver to you, and that's a message about our workers. For two months, as the pandemic has ravaged the globe, food workers have continued to go to work so we can have food. Our workers are heroes, but they do not have superpowers. Despite all of our efforts, they are getting sick. Tragically, as we have now heard, three food workers in Canada have died after contracting COVID-19. We send to their families and colleagues our deepest condolences.
We ask that you, as industry leaders, help us ensure that the Prime Minister and the public understand and acknowledge the efforts these workers are providing and the benefit they're providing to all of us, to make sure we have food in our pantries.
Thank you very much.