"I'm outraged by the news that a Canadian citizen, John Ridsdel, held hostage in the Philippines since September 21, 2015, has been killed at the hands of his captors," Trudeau said.
"This was an act of cold-blooded murder and responsibility rests with the terrorist group who took him hostage."
Ridsdel, fellow Canadian tourist Robert Hall, Hall's girlfriend Filipina Marites Flor, and Norwegian resort manager Kjartan Sekkingstad were kidnapped seven months ago from yachts at a marina near the major city of Davao, more than 500 kilometers (300 miles) from Jolo.
Six weeks after the abduction, gunmen from the Abu Sayyaf militant group released a video on social media of their hostages held in a jungle setting, demanding the equivalent of $21 million each for the safe release of the three foreigners.
The men were forced to beg for their lives on camera, and similar videos posted over several months showed the hostages looking increasingly frail.
In the most recent video, Ridsdel, a retiree in his late 60s, said his captors would kill him on April 25 if a ransom of $6.4 million were not paid.
Hours after the deadline passed, police in the Philippines said two people on a motorbike dropped the head near city hall on Jolo, a mostly lawless island around 1,000 kilometers south of Manila that is one of the Abu Sayyaf group's main strongholds.
"We found a head in a plastic bag," provincial police chief Wilfredo Cayat told AFP.
He said the head belonged to a white man, but emphasized it was impossible to immediately identify. The local police chief issued a report to journalists with similar details.
Trudeau said Canada was working with the Philippines to pursue and prosecute Ridsdel's killers, and that efforts were underway to obtain the release of the other hostages.
Canadian opposition parties also expressed outrage over the killing.
Ridsdel was a friend of Bob Rae, who preceded Trudeau as leader of Canada's Liberal party. The former journalist, oil executive and sailing enthusiast had moved to the Philippines to manage a gold mine prior to retiring.
'New Somalia'
The Abu Sayyaf is also believed to be holding a Dutch bird-watcher kidnapped in 2012, and has been blamed for abducting 18 Indonesian and Malaysian sailors from tugboats near the southern Philippines over the past month.
The Abu Sayyaf is a small group of Islamic militants listed by the United States as a terrorist organization that operates from Jolo and nearby islands.
It is a radical offshoot of a Muslim separatist insurgency in the south of the mainly Catholic Philippines that has claimed more than 100,000 lives since the 1970s.
It is blamed for the nation's worst terror attacks, including the bombing of a ferry in Manila Bay in 2004 that killed more than 100 people, as well as the kidnappings of dozens of foreigners in the southern Philippines and across to Malaysian Borneo.
The Abu Sayyaf's leaders have recently declared allegiance to the Islamic State group causing carnage in the Middle East and have carried out deadly attacks in Europe.
However, analysts say the Abu Sayyaf is mainly focused on lucrative kidnappings for ransom, rather than waging an ideological war or creating a violent Islamic caliphate.
The United States deployed special forces advisers to provide training and intelligence to Filipino troops from 2002 to 2014, which led to the killing or arrest of many Abu Sayyaf leaders.
After the US forces pulled out, however, the Abu Sayyaf launched a series of increasingly bold kidnapping raids, as well as deadly battles with Filipino troops that show it remains a major threat in the south.
The recent kidnapping spree prompted Indonesian Security Minister Luhut Panjaitan to warn the region was in danger of becoming a "new Somalia," referring to pirates operating from the African country who have bedevilled international shipping in nearby waters.
