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Canada Farmers Earning Less Income In 2009

Canadian farmers are earning less so far in 2009 as grain prices have slipped and the United States is buying less Canadian livestock, Statistics Canada said Nov. 24.

Farm cash receipts, which include crop and livestock revenues plus payments from government programs, dropped 4.2 per cent to $32.8 billion from January through September compared with the same period a year ago.

Cash receipts don’t measure a farm’s bottom line, which also takes into account expenses such as loans, fertilizer and seed.

The drop in grain prices reflects a return to more normal market conditions after a run-up in 2008. Livestock farmers, meanwhile, have suffered from a U. S. food-labelling law that has resulted in American packers importing fewer cattle and hogs.

StatsCan also cited factors such as the strong Canadian dollar, which makes exports less attractive, and the H1N1 flu outbreak in spring, which resulted in some pork markets temporarily halting imports from Canada.

“There’s a lot of frustrated, disenchanted farmers out there,” said Terry Boehm, a grains and oilseeds farmer at Colonsay, Saskatchewan and vice-president of the National Farmers Union in Canada. “They thought that after decades they were seeing some improvement in grain prices but they’ve seen it snatched away pretty quickly.”

Companies that sell farmers goods, ranging from seed and fertilizer to fence posts and satellite technology, often see their own performance tied to farm income.

Non-traditional farming tools such as global-positioning systems are among those products that have fallen victim to farmers’ thriftiness. Hemisphere GPS, a Canadian manufacturer of the farm technology, posted a wider-than-expected quarterly loss earlier this month on weak agricultural demand.

On the other hand, Rocky Mountain Dealerships, a Canadian dealer of farm and construction equipment, recorded higher-than-expected earnings this month, thanks in part to strength in its agricultural market.

A modest 1 . 9 per cent increase in farm cash receipts from the supply-managed dairy and poultry sectors eased the overall decline for the livestock industry.

StatsCan also said Nov. 24 that farmers’ net income rose in 2008 for a second straight year, to $3.6 billion. That was a sharp 79 per cent jump from 2007 because of spiking grain and oilseed prices, StatsCan said.

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