Lower costs raised farm incomes in 2010
Thursday, November 24, 2011
by BETTER FARMING STAFF
Canadian producers’ realized net income in 2010 jumped nearly 30 per cent from 2009, mostly due to lower operating expenses, show new figures released from Statistics Canada on Thursday.
In fact, national total farm cash receipts in 2010, including payments, actually dropped marginally although Ontario’s share grew to $10.3 billion from 9.8 billion in 2009.
Realized net income is the difference between a farmer’s cash receipts and operating expenses minus depreciation, plus income in kind.
Total revenues from crop and livestock sales only increased marginally in the year-to-year comparison. Higher hog and cattle prices drove up livestock receipts by 4.5 per cent, with the market price of cattle at its highest level since 2002. Overall crop receipts, on the other hand, fell 3.4 per cent to $22.4 billion. Contributing to the drop were lower prices and reduced amounts of product such as wheat, barley, lentils and potatoes that farmers brought to market. However, in Ontario, corn receipts were up 25 per cent and soybeans up 10 per cent over 2009 numbers, partly due to last year’s record production.
Ontario’s total farm expenses also grew marginally although nationally, these expenses, which include total operating expenses and depreciation, fell 2.5 per cent in 2010 from 2009 levels. StatsCan attributes the drop to declines in fertilizer, feed and pesticide expenses.
Meanwhile, cash receipts for Canada’s farmers between January and September of this year totaled $35.8 billion, a jump of nearly 11 per cent compared to the same period in 2010. Farm cash receipts include market receipts from the sale of crops and livestock plus program payments.
Market receipts for crops jumped 15 per cent to $18.3 billion in the same time period and is attributed to higher prices. Livestock receipts jumped more than 6 per cent to $15 billion. Most of the increase in livestock receipts can be attributed to the highest average hog price for the January to September period since 2004 and higher prices in the supply-managed sector.
Program payments were also up more than 11 per cent compared to the same period in 2010 and are attributed to increases in Quebec program payments as well as crop insurance payments in Saskatchewan and Manitoba. BF