2020 mid-year farmland values – affordability improves with growth in farm revenue

Demand for Canadian farmland remains strong; however, tighter farm profitability contributed to a slower appreciation rate in all provinces but Alberta and Saskatchewan. Through the first six-month of 2020, Canadian farmland values increased by 3.7% on average. Plenty of factors explain the strong demand for farmland: healthy balance sheets and historically strong returns on farmland, low interest rates, and grains, oilseeds and pulse receipts that increased 6.3% in the first six months of 2020 despite several challenges including trade restrictions, weather challenges, a rail strike and COVID-19.

 

With the growth in grains, oilseeds, and pulse receipts outpacing the appreciation in farmland values, the affordability of land improved for Canadian farm operations. However, this trend is not consistent across all provinces. One tool to gauge farmland’s affordability is to compare the average per acre land value divided by average expected returns per acre (price to revenue ratio). The 2020 price-to-revenue ratio estimate assumes the mid-year increase is reflective of the entire year. To forecast revenue, we use actual producer prices through August as well as futures market prices and industry yield expectations.

 

In Saskatchewan (Figure 1), strong increases in farmland values are matched with equally strong projected yields and prices, resulting in the price to revenue ratio expected to remain stable in 2020. In Ontario (Figure 2), the price to revenue is expected to trend down because of stronger crop revenues. Overall, affordability is expected to improve or remain flat in all provinces. The exception is Alberta, where farmland values increased 4.9% through the first 6 months and revenue is projected to increase by 3.8% based on current market prices and production estimates.

Video: From Conventional to Regenerative: Will Groeneveld’s Journey Back to the Land

"You realize you've got a pretty finite number of years to do this. If you ever want to try something new, you better do it."

That mindset helped Will Groeneveld take a bold turn on his Alberta grain farm. A lifelong farmer, Will had never heard of regenerative agriculture until 2018, when he attended a seminar by Kevin Elmy that shifted his worldview. What began as curiosity quickly turned into a deep exploration of how biology—not just chemistry—shapes the health of our soils, crops and ecosystems.

In this video, Will candidly reflects on his family’s farming history, how the operation evolved from a traditional mixed farm to grain-only, and how the desire to improve the land pushed him to invite livestock back into the rotation—without owning a single cow.

Today, through creative partnerships and a commitment to the five principles of regenerative agriculture, Will is reintroducing diversity, building soil health and extending living roots in the ground for as much of the year as possible. Whether it’s through intercropping, zero tillage (which he’s practiced since the 1980s) or managing forage for visiting cattle, Will’s approach is a testament to continuous learning and a willingness to challenge old norms.

Will is a participant in the Regenerative Agriculture Lab (RAL), a social innovation process bringing together producers, researchers, retailers and others to co-create a resilient regenerative agriculture system in Alberta. His story highlights both the potential and humility required to farm with nature, not against it.