The Farm Succession Crisis and Farmland Easement Agreements

According to Statistics Canada, the average age of farmers in Ontario is 55, and most of the farmers in the country are now in their late 50s, 60s, or older, and planning on retiring soon. What’s more, is that less than a quarter of the entire farm population is under the age of 35 (Statistics Canada, 2011).

 

This is troubling because it means that in the next 25 years, there will be a lot of farmers looking to retire, but not a lot of young farmers who could farm in their place.

 

It is this unbalance in the labour force that is one of the biggest threats to Ontario’s agricultural industry right now. This is called the farm succession crisis.

 

 

 

The farm succession crisis is caused by a number of factors: the farm income crisis, the rising cost of farmland, and the fact that many farmers do not have access to the resources they need to help guide them through succession planning.

 

The farm income crisis is based on the issue that often times, due to increasing operating costs but no increased revenue, farmers are unable to break even. In fact, a submission to Canada’s Ministers of Agriculture Meeting found that most farmers in 2005 had a lower income than farmers did during the Great Depression (NFU, 2005).

 

For those young people who are still seeking to become farmers, a major hurdle that they have to overcome is the rising cost of farmland. When the price of land is driven up by the possibility of development, it significantly reduces the accessibility of it to young farmers.

 

Succession planning is critical when it comes to protecting the future of Ontario’s agricultural sector, as it helps ensure a smooth transition from one generation of farmers to the next.

 

However, many farmers do not currently have a successor or a written succession plan for their retirement. Many farmers do not have access to resources that can help them in their succession planning, and they may not have a family member who is interested in taking over the farm. Without a strong succession plan, the farmland may be bought for non-agricultural development and lost forever.

 

When we lose farmland, we jeopardize the food security of the province, we lose habitat for species at risk, and jobs in the agri-food sector are threatened. Addressing this crisis will help to protect farmland, and will help feed future generations of Ontarians.

 

 

 

The Farmland Easement Agreements that Ontario Farmland Trust (OFT) creates with landowners can help in the succession planning process. 

 

Farmland Easement Agreements are the strongest tool available to farmland owners to ensure that their farmland will be protected, no matter who owns it in the future. Farmland Easement Agreements are permanent, legally binding agreements that landowners enter with OFT and that are registered on the title of the land. Once registered, these agreements will run with the land, and apply to all future owners of the property. So, even if the land is sold, it is guaranteed to remain as farmland forever.

 

Farmland Easement Agreements can help during the succession process in a number of ways.

 

If there is no successor lined up to take over the farm, easements ensure that no matter who buys the farm next, the land will remain available for agriculture. This means that the land will never be lost to non-agricultural development such as urban sprawl or aggregate extraction.

 

Another way Farmland Easement Agreements help with succession planning is by making farmland more affordable for the next generation. When developers buy the land, they are able to pay more than a new farmer who is just starting out, and that young farmer may be outbid. With a Farmland Easement Agreement on the land, developers are not as interested, and the price of the protected farmland is more likely to remain attainable for the next generation of farmers.