Better Investment Could Boost Canada Farm Sector
A new report from Farm Credit Canada (FCC) highlights how stronger productivity growth could bring major economic benefits to Canadian agriculture. The report explains that if productivity returns to historic levels of two per cent annually, farmers could gain up to $30 billion in additional income while Canada’s economy could grow by $31 billion, creating nearly 23,000 new jobs.
For more than 50 years, Canada has stood out as a global food leader through better management practices, improved input use, and greater technological innovation. However, the report warns that productivity growth has slowed in recent years, which may affect farmers’ competitiveness and Canada’s ability to meet future food needs.
“Canada’s agricultural productivity growth has consistently outpaced other G7 countries for more than three decades, showing the strength and adaptability of our producers,” said J.P. Gervais, executive vice-president strategy and impact at FCC. “Even so, our growth has slowed, turning that around will take continued investments to spur innovation, and smarter ways of working to help producers improve efficiency and stay competitive in a fast-changing global market.”
FCC leaders say that Canada’s agriculture sector has a strong track record of adaptability. They believe growth can accelerate again through better investment, improved efficiency, and stronger support for innovation. The report points out that low investment in research and development and slower venture capital support for ag tech are key barriers that must be addressed. Every dollar invested in agricultural innovation can return $10 to $20 over time, showing the value of increased funding.
The FCC report identifies three main pathways to boost productivity:
Farmers often face risks when testing new methods because they have only one growing season each year. FCC supports real-world testing through its Innovation Farms powered by AgExpert, helping producers try new ideas safely and effectively.
“Canadian agriculture has the talent, ingenuity and drive to lead the world in sustainable food production,” said Justine Hendricks, president and CEO at FCC. “By putting productivity and innovation at the center of how we grow, we can strengthen our food system, support the people behind it and build a more resilient industry for today and future generations.”
FCC has also committed $2 billion by 2030 to advance agricultural and food innovation. Its investment arm, FCC Capital, helps companies develop new technologies that improve efficiency, sustainability, and productivity across the value chain.
The report notes that productivity growth peaked at two per cent in earlier decades but dropped to 1.3 per cent in the 2010s. If current trends continue, growth may fall below one per cent, similar to the 1970s. Reaching past growth levels could significantly increase profitability for both crop and livestock producers.
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