Farmland values in Saskatchewan rose again in 2016 but the increase was less than in other provinces, according to the latest Farm Credit Canada (FCC) farmland values report.
Nationally, farmland values increased an average of 7.9 per cent in price. In Saskatchewan prices rose by 7.5 per cent, compared to 9.4 per cent in 2015. Farmland prices have been rising since 2002 with a record increase of 28.5 per cent in 2013.
“The fact is … the average change in farmland values across the country has been starting again to slow down. That’s the third successive year that we’ve seen the rate of increase in farmland slowing down,” said J.P. Gervais, vice-president and chief agricultural economist with FCC.
In the neighbouring provinces of Alberta and Manitoba farmland values increased by 9.5 per cent and 8.1 per cent respectfully. The highest increase nationally was in Prince Edward Island with a 13.4 per cent increase.
In Saskatchewan farmland prices varied around the province with the east-central and southeastern regions recording no increase in values. The northwestern region saw a 10.3 per cent increase and the northeastern region a 9.3 per cent increase. In the west-central region there was a 7.8 per cent increase. The largest increase in farmland values was recorded in the southwestern region at 16.6 per cent.
Prices varied across the province due to a number of reasons. At the start of the year pulse crops prices were expected to reach record highs, however a wet summer and fall lead to quality issues.
“The pulse crop area more on the western side of the province had a ton of optimism last year and that was a big factor in what people were willing to pay for land out in that area,” said Scott Sahulka, senior director of valuation and environmental risk with FCC.
A wet harvest slowed down progress with 1.3 million acres of crop being left out in the fields last year, which also affected farmland values. In the east part of the province Sahulka said there has been repeat wet years.
Source : Leaderpost