Large increases in fertilizer and fuel costs are being blamed for a sharp drop in Manitoba farmers’ net income last year. Manitoba’s net cash farm income dropped to $725 million in 2008 – down 8.6 per cent from 2007.Netcash income is the difference between total farm cash
receipts, including payments, and total operating expenses after rebates.
Realized net income (net cash income minus depreciation) fell even more – down 31 per cent to $232 million.
Only three other provinces (Nova Scotia, Prince Edward Island and Newfoundland and Labrador) showed decreases in realized net farm income. All other provinces recorded increases over 2007 levels.
Statistics Canada released the figures in a farm income report last week.
Meanwhile, net farm income for Canada as a whole increased in 2008.Netcash income across the nation rose 21 per cent to $8.5 billion while realized net income jumped 63 per cent to $3.3 billion.
Ian Wishart, Keystone Agricultural Producers president, blamed high input costs last summer for Manitoba’s poor showing.
“It took quite a big chunk of profit off everybody’s bottom line,” Wishart said.
Preliminary surveys by KAP suggest fertilizer prices went up more in Manitoba than in other western provinces, but the association isn’t sure why.
Manitoba has some “very dramatic price differentials” with Saskatchewan and Alberta in farm inputs, said Wishart.
Manitoba’s total farm cash receipts actually rose 8.7 per cent in 2008 but failed to keep pace with a 12.6 per cent increase in total operating costs.
A financial crisis in the hog and cattle sectors also contributed to Manitoba’s lower bottom line in farm income.
Cattle producers are still recovering from the after-effects of BSE in 2003. Hog farmers are in their third year of depressed market prices and high feed costs. Both also suffer the effects of U. S. country-of-origin meat labelling, which restricts live cattle and hog exports.
Manitoba normally exports the majority of its live hogs and weanlings to the U. S., while most of its beef cattle are sold to the U. S. or other provinces for finishing and slaughter. [email protected]