Farmland Values Increase

By AllisonFinnamore
Farm Credit Canada

The average value of Canadian farmland increased 2.9 per cent during the first six months of 2009, reports Farm Credit Canada in its fall Farmland Values Report released earlier this week.

Twice a year since 1990, FCC appraises farm properties across the country and releases a report on its findings. Appraisers estimate market value using comparable sales.

Farmland values increased in most provinces with New Brunswick experiencing the highest increase at 5.6 per cent, followed by Manitoba with an increase of 5.5 per cent. Quebec and Nova Scotia also experienced similar percentage increases at 4.3 and 4.2 per cent respectively.

Saskatchewan farmland values continued to rise with a 3.4 per cent increase, followed by Ontario and Newfoundland and Labrador which each experienced an increase of 2.8 per cent.

Alberta had the smallest increase at 1.0 per cent while British Columbia and Prince Edward Island farmland values decreased by 0.7 and 1.4 per cent respectively.

Ontario

Ontario farmland values increased 2.8 per cent during the first six months of 2009. A stable to upward trend appeared to be consistent across the province, with small increases noted in both eastern and northern Ontario.

Factors contributing to the changes in land values were varied. Cash crops continued to show profitability due to increased demand from local ethanol plants for corn, increased global demand for basic grains and strong growth in the biofuels sector. Meanwhile large, intensive livestock enterprises continued to have strong demand for land to satisfy nutrient management program requirements.

Some land value increases in the area bordering Lake Huron occurred because of wind turbine contracts. Premium prices were paid for farmland parcels because of income generated by the contracts.

Workable land was still in demand by local livestock farmers and international buyers.