The federal government has announced $50 million in funding for Natural Products Canada (NPC) to help expand Canada's agri-food innovation sector through a project valued at $94.8 million.

The funding, provided through the Strategic Response Fund, will support NPC's efforts to commercialize Canadian agrifood and bio-based technologies and increase their adoption in domestic and international markets.

According to the government, the project is expected to create more than 550 jobs and contribute more than $1.8 billion to Canada's gross domestic product. The investment will also enable NPC to establish a Capacity Building Fund to support food manufacturing and processing projects aimed at increasing domestic production, strengthening supply chains and improving food security.

The funding forms part of the federal government's National Food Security Strategy, which seeks to increase domestic food production, improve access to affordable food and reduce Canada's dependence on imported food products.

Charlottetown-based Natural Products Canada is a national not-for-profit organization that works with companies developing food and bio-based technologies. It provides funding, commercialization support and connections to investors and industry partners.

Established in 2015, NPC has worked with more than 1,800 early-stage Canadian companies and has directly invested in more than 100 businesses. The organization says those investments have helped attract $622 million in follow-on capital and contributed about $900 million to Canada's GDP.

The latest funding builds on about $25 million in federal support announced in 2021 through the Strategic Response Fund for an earlier NPC initiative.

The Strategic Response Fund supports business-led innovation networks involving companies, universities and research institutions. Under the program, funding is distributed by the lead organization to project partners and recipients.

The government said the National Food Security Strategy is intended to strengthen Canada's food system by supporting innovation, expanding domestic production capacity and improving the efficiency and resilience of food supply chains.