May
10, 2011. Guelph, Ont – The average value of farmland in Ontario increased by
2.4 per cent during the second half of 2010, following gains of 4.3 and 3.3 per
cent in the two previous reporting periods, according to the new Farm Credit
Canada (FCC) Farmland Values Report. The report provides important information
about changes in land values across Canada and is available at
www.farmlandvalues.ca.
May
10, 2011. Guelph, Ont – The average value of farmland in Ontario increased by
2.4 per cent during the second half of 2010, following gains of 4.3 and 3.3 per
cent in the two previous reporting periods, according to the new Farm Credit
Canada (FCC) Farmland Values Report. The report provides important information
about changes in land values across Canada and is available at
www.farmlandvalues.ca
“FCC
is committed to advancing the business of agriculture and one of the ways to do
this is by providing producers with our market based observations twice a year
to help them make timely management decisions,” says Michael Hoffort, FCC
senior vice-president, portfolio and credit risk.
In
Ontario, values increased by an average of 0.6 per cent per month in 2010, the
highest across Canada. Farmland values in Ontario have been rising since
1993.
Comparatively,
the average value of Canadian farmland increased 2.1 per cent during the last
six months of 2010 and continued the steady increase reported during the last
decade. Farmland values remained stable or increased in all provinces. Prince
Edward Island experienced the highest average increase at 3.2 per cent.
In
the last three semi-annual reporting periods, farmland values in Canada
increased by an average of 3.6 per cent in spring 2010, 3.0 per cent in fall
2010 and 2.1 per cent in spring 2011. The highest average national increase was
in 2008 at 7.7 per cent. The last time the average value decreased was in 2000
at -0.6 per cent.
“Canadian
land values are strong and, looking at world markets in our current financing
environment, there are factors in place that could exert further upward
pressure on the price of farmland” says Jean-Philippe Gervais, FCC senior
agriculture economist. “Rising incomes and population growth in emerging
countries is increasing the demand for ag commodities at a time when global
cereal stocks are low, production conditions in some major grain producing
countries could potentially be challenging and the availability of quality
farmland worldwide is limited,” says Gervais.
According
to a fall FCC Vision Panel survey, 26 per cent of the producers who responded
planned to increase capital spending on land in 2011. Crop (33 per cent),
poultry (32 per cent) and dairy (28 per cent) producers were more likely to
state that they are planning to increase spending on land in the next year
compared to other animal (21 per cent), hog (17 per cent) and horticulture (17
per cent) producers. Manitoba (30 per cent), Saskatchewan (30 per cent) and
Ontario (28 per cent) producers are more likely to report that they are
planning to increase spending on land compared to British Columbia (17 per
cent) and Quebec (21 per cent) producers. FCC Vision Panel survey findings can
be found at www.fccvision.ca/research.
The
FCC Farmland Values Report has been published since 1984.
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