Agriculture Canada forecasts up to 10 good years for farm incomes

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OTTAWA — Almost all Canadian farmers, from wheat growers to cattle ranchers to potato producers, can look forward to good times for up to the next 10 years, according to new government projections.

Agriculture Canada says by almost any measure, average farm income set new records in 2011.

Net cash income _ money available for everything from machinery replacement to living expenses _ is expected to total nearly $12 billion. That's a 24 per cent increase over 2010 and a whopping 47 per cent increase over the five-year average.

The lucrative harvest came even after an eight per cent increase in operating expenses.

What's more, the horn of plenty included almost all agricultural sectors.

Grains and oilseeds farmers are expected to reap record net operating incomes 44 per cent higher than 2010. Incomes for hog producers should reach new highs, driven by rebounding prices that have sent market receipts soaring 20 per cent.

Dairy income should be up seven per cent over 2010. Poultry and egg producers expect an average 21 per cent increase. Potato farmers are looking at 20 per cent increases.

Only cattle producers faced a setback in 2011 over rising costs. However, Agriculture Canada experts say that comes after several years of gradually rising incomes. Cattle prices are expected to keep improving and Canadian herds are gradually rebuilding.

Farmers will face challenges in the years to come, mostly from increasing expenses.

Fertilizer costs are expected to rise ``modestly,'' the report says. As well, livestock producers are expected to face continually rising costs for feed, as demand for grains drives up prices.

However, the report says the conditions that led to a profitable 2011 are likely to stick around for a decade.

``Many of the factors that will influence farm income in 2011 and 2012 will continue to be felt over the next 10 years,'' it says. ``These include continued increase in world demand for feed grains, a rising price of petroleum, slow-moderate Canadian population growth, and a Canadian dollar near par with the U.S. dollar.''

The impact of a healthy agriculture isn't likely to have a big effect on Canada's overall economy, experts said. They point out that agriculture only accounts for about three per cent of Canadian GDP.

Geographic location: Canada, OTTAWA, U.S.

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Recent comments

  • Edith Ling
    February 21, 2012 - 22:15

    Island Farmer - This is just another sample of mis-information to lead the general public to believe that farmers are doing much better financially. Hog prices today are below what they were in the 1970's and early 80's. However, expenses have increased greatly. Despite what Agric. Canada says about livestock farmers experiencing several years of gradually rising incomes, it is only the last few months that beef farmers have received break-even prices. Potato prices are very little more than break even. However we must remember all the poor price years. One decent year does not make up for ten poor years. It will take years for farmers to get caught up and get out debt. Farmers' input costs have doubled in the last 20 years, yet we are selling products at 30 to 40 year old prices.

  • great for Island farmers
    February 21, 2012 - 12:20

    Great news for Island farmers. They'll have 10 great years, will be able to pay back their debt to banks and province and add financially to the provinces economy. Wonderful news!

    • Irishnannie
      February 21, 2012 - 14:35

      Agri Canada- "Cattle producers faced a setback in 2011.However that comes after several years of gradually rising incomes". The statement creates the wrong perception. Following the devestation of mad cow in 2003 prices CRASHED for farmers. It took "years" to regain pre-mad cow prices and even at that costs far exceeded income. I find it sad that a Gov. Agriculture body could issue a comment like this. It gives the impression of good income growth. If I am paid well below minimum wage and my income rises to "almost" minimum wage I am still in the working poor.