Canadian farm sector equity increased slightly more than previously expected in 2024 but still marked the first slowdown in five years.
A Statistics Canada report Thursday pegged the value of national farm sector equity as of Dec. 31, 2024 at $833.4 billion, up $39.3 billion or 5% from a year earlier. That compares to the $38.9 billion or 4.9% gain that StatsCan initially reported back in June but is still down from the 7.8% advance recorded in 2023.
While equity continued to rise in every province, the pace of growth cooled as farm debt expanded much faster than asset values. Total farm sector liabilities climbed 14.5% in 2024, compared with a 6.4% increase in total assets, marking the first time in five years that leverage meaningfully outpaced balance-sheet growth. Saskatchewan and Alberta accounted for more than two-thirds of the national increase in equity, with gains of 10% and 5.7% respectively. Manitoba posted a 4.5% increase, while Ontario saw a more modest rise of 1.3%.
Rising farmland values remained the primary driver behind higher farm assets. Total farm assets increased by $59.4 billion to $992.4 billion in 2024, with more than four-fifths of that growth tied to farm real estate. Farmland values alone rose $46.4 billion, or 7%, reaching $713.3 billion nationwide. Land values increased in every province except Newfoundland and Labrador, underscoring continued demand for farmland despite softer crop prices and tighter financial conditions.
Other asset categories showed mixed results. Current assets rose just 1.7% to $59.8 billion. The value of crop inventories fell sharply, dropping $3.4 billion, or 12.4%, to $23.8 billion as grain and oilseed prices declined 13.6% while on-farm stocks edged higher. Large domestic and global supplies continued to weigh on crop prices, extending a downward trend that has been in place since 2023.
Livestock inventories, by contrast, posted strong gains. The value of poultry and market livestock inventories surged 27.1% to $16.6 billion, driven primarily by higher prices rather than increased numbers. Breeding livestock values also jumped, rising $4.1 billion, or 26.7%, to $19.7 billion. Historically high cattle prices and steady domestic and international demand supported the increase, even as inventories declined slightly.
On the liability side, farm debt rose sharply across the country. Total liabilities increased $20.1 billion to $159 billion in 2024, the largest percentage increase since records began in 1981. Long-term liabilities accounted for more than four-fifths of the rise. Alberta, Ontario and Quebec together represented over two-thirds of the national increase in farm debt.
The impact of rising debt and higher interest rates is increasingly visible in key financial indicators. The farm sector’s interest coverage ratio fell to 2.265 in 2024, down for a second consecutive year and the lowest level since 2007.
