The steepest fall in crop returns in more than two decades badly dented Canadian farm income last year, according to preliminary numbers released by Statistics Canada Wednesday.
The federal agency pegged 2024 realized net income for Canadian farmers at $9.4 billion, down $3.3 billion or almost 26% from the previous year. That marked the largest year-over-year percentage decline in realized net income since 2018, when it tumbled 41% to $4.2 billion, mainly due to sharply higher farm expenses.
Stripping cannabis out of the equation made the fall in realized net farm income a bit less steep – down 23% to $9.7 billion – although still significant.
Realized net income is the difference between a farmer's cash receipts and operating expenses, minus depreciation, plus income in kind.
Mainly the result of lower prices for most major grains and oilseeds, total Canadian crop receipts fell 6.2% to $52.1 billion in 2024, the largest percentage drop in crop receipts since 2003.
Wheat (exl durum) returns in 2024 amounted to $8.4 billion, down 18% from a year earlier. Durum returns also plunged about 18%, falling to $1.8 billion. Canola returns fell 5.3% to $12.9 billion. National corn and soybean receipts declined 13.5% and 12%, respectively, to $3.1 billion and $3.7 billion.
Prices for most major crops began to decline in 2023, following two consecutive years of strong growth, as domestic production recovered and supplies improved, StatsCan said. Ample domestic and international supplies continued to put downward pressure on the price of grains and oilseeds in 2024, leading to lower receipts, despite higher marketings, it added.
Crop receipts fell in most provinces, with the Prairies recording the largest declines, led by Saskatchewan (-$1.7 billion) and followed by Alberta (-$1.1 billion) and Manitoba (-$662.9 million).
On the other hand, livestock receipts rose 6.9% to $39.9 billion in 2024, on gains across all livestock sectors except poultry.
Cattle and calves receipts were up 11.6% to $16.7 billion in 2024, accounting for more than two-thirds of the rise in total livestock receipts. The cattle market continued to record historically high prices, due to steady domestic and international demand for beef, as well as smaller herds in Canada and the US. In 2024, average prices for cattle and calves were more than 50% above the 5- and 10-year averages, StatsCan said.
Hog returns were up 8% to $6.3 billion in 2024, while receipts from the supply-managed sector posted their slowest growth in four years, up 2% to $15.2 billion.
Meanwhile, total government payments to Canadian producers fell 10.8% to $5.9 billion in 2024. It was the second consecutive double-digit decline, following two years of strong increases in 2022 (+23.6%) and 2021 (+71.8%), when drought-related losses led to higher payments.
All told, national farm cash receipts fell $1.6 billion to $97.9 billion in 2024, and were down in five provinces, led by Saskatchewan (-$1.3 billion) and Manitoba (-$433.5 million).
On the other side of the ledger, total farm operating expenses (after rebates) rose 2.4% to $78.3 billion in 2024.
For the second consecutive year, interest expenses led the gain in total farm operating expenses, up 28.6% in 2024 from the previous year. In response to easing inflation, the Bank of Canada began cutting its key interest rate in mid-2024 after over two years of hikes. However, producers took on more debt, driving up interest expenses, StatsCan said.
