Farm Financial Health Report 2023-2024
Taking Stock of Farm Financial Health Amid Rising Costs of Production and a Rapidly Changing Climat
Wednesday, November 8, 2023

Section: Taxes

Canadian Federation of Agriculture

Farmers across Canada have demonstrated tremendous resilience in the face of several domestic and global events including the COVID-19 pandemic, the war in Ukraine, and extreme climate events at home and abroad. In 2022, primary agriculture contributed $36.2 billion of Canada’s GDP and supported 257,000 jobs across the country.

However, through this time, the cost of critical farm inputs such as fuel, fertilizer, feed, machinery, pesticides, land and labour increased dramatically. When coupled with high inflation, interest rates and a price on carbon for essential farming activities, for which farmers have no viable alternatives, Canadian producers are facing tremendous pressure on their farm financial and mental health.

While most Canadian farmers have managed to stay afloat, largely due to high commodity prices and farm cash receipts that increased 14.8% over 2021 levels, the ongoing impact of high inflation, matched with increasing interest rates, is beginning to take a serious toll on the operating margins of Canadian producers. Recent numbers from Statistics Canada have shown that the net income for Canadian farmers fell 8.3% in 2022, because the growth in expenses outpaced the rise in farm income; and total farm operating expenses (after rebates) increased by 21.2% in 2022, the largest gain since 1974 (+22.0%).

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