Farm Income, Financial Conditions and Government Assistance Data Book, 2014
The Farm Income, Financial Conditions and Government Assistance Data Book is a compendium of historical data series from several sources compiled into a single, convenient resource for users of data on key economic and financial indicators of the agriculture sector. The information provides a comprehensive view of the situation in primary agriculture and the expenditures that governments are making to ensure a strong and competitive sector. The Data Book also provides valuable information on government assistance to the agriculture and agri-food sector not easily available from other sources.
Information is provided by several organizations within Agriculture and Agri-Food Canada, as well as by other federal departments. Information in the Data Book is also prepared in consultation with the provincial ministries responsible for agriculture.
The Data Book is divided into four sections:
- Section A presents information related to farm income,
- Section B contains information on farm financial conditions,
- Section C provides data on government expenditures for the agri-food sector, and
- Section D provides information on estimates of support to agriculture.
Notes on the methodology are provided at the end of each section. Each edition of the Data Book provides the most up-to-date economic and financial indicators.
Section A - Farm income
- In 2013, total market receipts from both crop and livestock sources reached $52.2 billion, the highest level over the 10-year period 2004-2013. The increase in market receipts in 2013 was due to the combination of strong crop receipts of $30.6 billion and strong livestock receipts of $21.5 billion, both highs over the previous 10 years.
- Net cash income in 2013 at $12.7 billion was the highest level reported over 2004-2013, surpassing the previous record of $12.4 billion achieved in 2012. In comparison, the lowest net cash income level over the reference period was $5.9 billion in 2006.
- Program payments declined to $2.7 billion in 2013 from $3.4 billion a year earlier. In general, high income years since 2008 due to strong market conditions have reduced the need for program payments.
- Preliminary estimates for 2013 show that on average, the largest farms are in Newfoundland and Labrador, which reported average operating revenues of $594,778. The smallest farms are in Saskatchewan where the average farm reported $316,928 in total operating revenues in 2013. Nationally, the average farm reported $387,948 in operating revenues and $318,276 in operating expenses in 2013 for an average net operating income of $69,673. This is a 3% increase from $67,402 in net operating income reported a year earlier.
- Net operating income by farm type shows considerable variation. Potato farms had the highest average net operating income in 2013 at $216,130, followed by poultry and egg farms at $195,119. Grain and oilseed farms were at $93,823, other vegetable and melon farms at $79,110, fruit and tree nut farms at $38,146 and cattle farms at $12,142. Hog farms had an average net operating income of $104,258, a decline of 6% from a year earlier.
Section B - Farm financial conditions
- Farmers take on debt to meet short-term financial obligations and to make investments in their farming operations that take advantage of emerging marketing opportunities. In 2013, total farm debt in Canada stood at $78.0 billion.
- There were 66 farm bankruptcies in 2013, up from 46 a year earlier, but still historically low. Ontario (18 bankruptcies), Quebec (13 bankruptcies) and Manitoba (13 bankruptcies) reported the highest number. The number of farm bankruptcies has followed a declining trend since 1998.
- Farm Credit Canada approved 46,288 new loans in 2013-14. The average size of loan approved by Farm Credit Canada rose to $163,649.
- There were 1,747 new loans registered under the Canadian Agricultural Loans Act (CALA, formerly Farm Improvement and Marketing Cooperatives Loans Act) in 2013-14. Almost 3 out of 4 new loans were in Saskatchewan.
- Farm balance sheets were generally robust in 2013. The average Canadian farm reported $2.8 million in assets and $0.5 million in debt, for an overall net worth of $2.3 million. There was considerable variation by farm type, with the net worth of poultry farms averaging $5.5 million, potato farms $4.4 million, dairy farms $3.4 million, hog farms $2.6 million, grain farms $2.5 million, and beef farms $1.7 million. Farms in British Columbia had the highest level of farm assets, at $3.6 million, followed by Alberta at $3.5 million. However, in terms of average net worth, Alberta farms were the highest at $3.0 million, followed by British Columbia at $2.8 million.
- In the fall of 2014, anhydrous ammonia cost an average of $962 per tonne in Ontario, $793 per tonne in Manitoba and $850 per tonne in Saskatchewan. Farmers in Ontario paid less for anhydrous ammonia than farmers in the neighbouring US states of Michigan, Ohio and Indiana, while farmers in Manitoba paid less than their neighbours in Minnesota and North Dakota. Farmers in Saskatchewan faced higher gasoline prices than their counterparts in Ontario and Manitoba, while diesel prices were similar in all three provinces. Farmers in Ontario and Manitoba paid higher prices for gasoline than their US neighbours, while diesel prices were higher only in Ontario.
- Total expenses for farming increased to $48.5 billion in 2013, up 2% from the previous year. Higher costs for depreciation, rent, pesticides, interest, other expenses, and cash wages were mostly responsible for the increase in expenses, but lower fertilizer expense offset part of the increase.
Section C - Government expenditures in support of the agri-food sector
- Total government expenditures in support of the agriculture and agri-food sector fell by 9% in 2013-14 to $6.0 billion. Federal expenditures declined by 10% to $3.02 billion while provincial expenditures fell by 8% to $2.98 billion.
- It is projected that federal expenditures will decline in 2014-15 by 10% to $2.72 billion, while provincial expenditures will fall by 3% to $2.88 billion. Total expenditures are expected to decrease by 7% to $5.61 billion.
- In 2013-14, federal program payments, which include primarily payments made directly to producers, are expected to decline to $1.18 billion. These payments are expected to stay at the same level in 2014-15. During the same two-year period, provincial program payments are expected to drop in 2013-14 to $1.38 billion and then decline to $1.14 billion in 2014-15.
- In 2013-14, categories with the highest expenditures are program payments, and research and inspection. These two categories together represented 75% and 54% of federal and provincial expenditures, respectively. However, the share of only research and inspection expenditures represented 39% at the federal level compared to 12% at the provincial level.
Section D - Estimates of support to agriculture
- Expressed as a percentage of gross farm receipts, the producer support estimates (PSE) for Canada fell from 15% in 2012 to 12% in 2013.
- From 2012 to 2013, the level of support, expressed as a percentage of gross farm receipts, decreased in the US (from 8% to 7%) while it stayed the same in Australia (2%), the European Union (20%), Mexico (12%) and New Zealand (1%).
- Support to specific commodities has fallen over time, but some commodities still receive a high level of support. This support is measured by the single commodity transfers (SCT), an indicator that measures transfers linked to the production of a single commodity. This indicator is expressed as a percent of gross receipts for the specific commodity. In 2013, milk is the commodity that received the highest level of support in Canada with an SCT of 44%. In the EU, beef and veal received the highest level of support with an SCT of 40%. In the US, no commodity had an SCT above 10%.
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