By Dori Modney with files from Agriculture and Agri-Food Canada

Income forecast projects record year for Canadian farms

Feb 26, 2021 | 6:41 PM

LETHBRIDGE, AB. — It`s still early going, as farmers aren`t even in their fields yet – but, they are preparing. And we don`t know what exactly Mother Nature will conjure up in terms of weather. No matter what nature throws at us, the bottom line is that `everyone has to eat.`

With that in mind, agriculture continues to be a strong driver of the Canadian economy and it`s farmers who are the key factor in ensuring Canadians have access to high-quality, affordable food.

Last week, agriculture and Agri-Food Canada completed an analysis of farm income for 2020 and 2021, with results showing that Canadian farm income and the value of farms is expected to be at an all-time high.

It`s information that puts many farmers and farm families on a stronger footing and positioned to contribute to Canada’s economic recovery.

At the annual Canadian Federation of Agriculture meeting last week, Minister of Agriculture and Agri-Food, the Honourable Marie-Claude Bibeau, shared the results of the analysis

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It was noted that the agriculture sector is expected to see significant growth in key financial areas for 2020 (fiscal year ends in March) and 2021.

In spite of the fact that COVID-19 was a challenge and impacted the food supply chains, the growth in farm income shows the sector is weathering disruptions and farm decisions are adjusted as needed.

Information released the analysis includes the following:

Net cash income (NCI) is forecast to have grown by 21.8 per cent in 2020, from $13.5 billion in 2019 to $16.5 billion in 2020. In addition, farm-level income is also forecast to have increased in 2020, with average net operating income (NOI) per farm increasing by 25.4 per cent, from just under $76,000 in 2019 to approximately $95,000 in 2020. Average farm family income is forecast to have increased by 8.6 per cent to just over $194,000 in 2020, driven by increases in NOI from farming.

Canada`s grain section had a strong year:

There was an 11.9 per cent increase in overall crop receipts. However, disruptions to the workforce, shifting international trade patterns, and fluctuating commodity prices have caused challenges, including for some parts of the crop sector, such as horticulture. Livestock receipts were forecast to have declined 1.9 per cent, largely due to negative impacts of COVID-19 on the red meats sector.

COVID-19 uncertainty continues to leave question marks for agriculture. Among the unforeseen, is disruptions to the workforce, fluctuating commodity prices and shifting international trade patterns. However, it`s expected normal market conditions will return. If so, NCI is forecast to grow in 2021 by 6.8 per cent to $17.6 billion.

Average farm-level NOI is forecast to increase 8.5 per cent to approximately $103,000 per farm, and average farm family income is forecast to grow 7.2 per cent to just under $208,000. Net worth is forecast to reach $3.5 million per farm, up 2.9 per cent from 2020 levels.

A strong export showing in 2020 can`t be ignored either. It reached nearly $74 billion, up from $67 billion in 2019. It means the government is close to achieving its target of $75 billion in agri-food and seafood exports by 2025.

Agriculture and Agri-Food Minister, Marie-Claude Bibeau sees the agricultural sector as an engine of growth, helping to restart the Canadian economy.

“Despite all the challenges they have faced because of COVID-19, the men and women in the agriculture sector have stepped up to keep our grocery store shelves stocked. Today’s farm income forecast and our strong export performance last year are welcome signs that Canadian farmers are finding success during these unprecedented times.”

Some other numbers to consider:

–Farm Cash Receipts for all principal field crops are forecast to have reached $28.3 billion in 2020, up 17 per cent from 2019 levels.

— Overall crop receipts are forecast to have increased by 12 per cent in 2020, offsetting a 2 per cent decline in livestock receipts.

— Farm Cash Receipts for pulses and special crops are forecast to have reached $3.6 billion in 2020.

For other details, check out the Farm Income Forecast results for 2020 and 2021