Thanks to soaring crop prices, farm income hit a new record in 2020 and will set another one this year, according to Agriculture and Agri-Food Canada.
“In spite of recent challenges, notably COVID-19’s impacts on the food supply chain, the growth in farm income shows that the sector is weathering these disruptions well and adjusting farming decisions accordingly,” AgCanada said in a news release.
It said the total net cash income for Canadian farms hit $16.5 billion last year — a $3-billion (or 21.8 per cent) jump, from 2019. The net operating income per farm grew by even more, hitting $95,000 last year. That’s a 25.4 per cent leap from the 2019 figure of $76,000 per farm.
But that average number does not tell the tale as crop growers had a far different year than livestock producers.
“While the agriculture sector on the balance had a good year, some sectors did better than others and growth was uneven,” said AgCanada. “The grain sector had a very good year with record crop production, strong prices, and minimal transportation issues. However, some other commodities, such as red meat and horticulture, saw more challenges from COVID-19 impacts.”
Crop receipts are estimated to have increased by 12 per cent last year while livestock receipts declined by two per cent, the department said.
But with canola prices hitting record levels, strong grain prices, and exports surging, it will be another very good year for crop producers, it predicted.
“There continues to be uncertainty surrounding COVID-19. However, based on the expectation that the current situation continues to return to normal market conditions, NCI (net cash income) is forecast to further grow in 2021 by 6.8 per cent to $17.6 billion.”
That would see net operating income grow by another 8.5 per cent this year and reach $103,000 per farm.
AgCanada also looks at total “farm family” income and said it hit $194,000 last year and will grow to “just under $208,000” in 2021.
“Net worth is forecast to reach $3.5 million per farm, up 2.9 per cent from 2020 levels,” it added.