Schwalger has warmed the bench the during the All Blacks first two Tests of the season against France and will form part of an all Hurricanes front row alongside Neemia Tialata and hooker Andrew Hore.
Full-back Mils Muliaina and fly-half Daniel Carter return from injury but captain Richie McCaw is rested, while Reuben Thorne will captain the side.
Rico Gear has re-joined the All Blacks and Ma'a Nonu has been released to join the Junior All Blacks in Dunedin.
The return of Gear, who has played in 17 Tests for the All Blacks, is prompted by impending paternity leave for wing Doug Howlett, who will not travel to South Africa.
Chris Jack will also miss the opening match of the Tri-Nations title defence because of the impending birth of his first child.
"The guys need to put their families first and we support their decision to be with their partners," said coach Graham Henry.
"Ross will start this weekend's Test and Rico has plenty of experience in our environment. So they will be up to speed before we start the Philips Tri Nations.
"We've got some new combinations for the Test in Hamilton which is a chance to further our depth and options, and gives us something of a fresh challenge."
Conrad Smith's return from injury is still not certain, with Luke McAlister ready to deputise.
Canada also named their team on Wednesday with only France-based locks Mike James and Jamie Cudmore missing from his usual starting line-up.
New Zealand squad to face Canada: Mils Muliaina; Doug Howlett, Conrad Smith/Luke McAlister, Aaron Mauger, Sitiveni Sivivatu; Dan Carter, Byron Kelleher; John Schwalger, Andrew Hore, Neemia Tialata, Ross Filipo, Troy Flavell, Reuben Thorne, Jerry Collins, Chris Masoe.
Replacements: Keven Mealamu, Carl Hayman, Rodney So'oialo, Richie McCaw, Piri Weepu, Luke McAlister/Rico Gear, Leon MacDonald.
Canada squad to face New Zealand: Mike Pyke; Justin Mensah-Coker, Craig Culpan, David Spicer, James Pritchard; Ryan Smith, Morgan Williams; Kevin Tkachuk, Pat Riordan, Scott Franklin, Mike Burak, Luke Tait, Colin Yukes, Sean-Michael Stephen, Stan McKeen.
Replacements: Aaron Carpenter, Dan Pletch, Mike Pletch, Josh Jackson, Adam Kleeberger, Dean Van Camp, Ed Fairhurst.