Net farm income continued to rise on a nationwide basis in 2015, but the cracks caused by generally lower commodity prices are certainly beginning to show.
A farm income report released Wednesday by Statistics Canada pegged 2015 realized net farm income (the difference between a farmer's cash receipts and operating expenses, minus depreciation, plus income in kind) at $8.1 billion, up 9.2% from a year earlier.
That was the good news.
The bad news was the increase in 2015 was much more modest compared to the 19.1% jump in net farm income seen the previous year. What’s more, realized net income this past year actually only rose in four provinces -Newfoundland and Labrador, Saskatchewan, Alberta and British Columbia – regardless of the increase at the national level.
According to StatsCan, the gain in 2015 realized net farm income was the result of a slight increase in farm cash receipts outpacing a small rise in operating expenses.
Farm cash receipts - which include market receipts from crop and livestock sales as well as program payments - rose 2.7% to $59.4 billion in 2015, the fifth consecutive annual increase.
Market receipts were up 2.7% to $57.3 billion in 2015, as gains in crop receipts more than offset a small decline in livestock revenue. Crop receipts totalled $31.6 billion in 2015, a 5.2% increase. This followed a 3% decrease in 2014.
Lentils, a crop grown primarily in Saskatchewan, contributed the most to the growth in crop receipts in 2015. Lentil receipts (+110.1%) more than doubled to $2.24 billion as prices increased 57.6%. Lentil marketings were up 33.3%, as production hit a record level. An increase in exports, largely to India, contributed to the rise in receipts.
The depreciation of the Canadian dollar relative to the US dollar supported the prices received by Canadian producers. At the same time, increased global stocks of grains and oilseeds put downward pressure on world prices expressed in U.S. dollars in 2015. However, Canadian farm-gate prices for most grains and oilseeds were up from 2014.