Farmers who lease cultivated crown land from the Saskatchewan government will pay 83 percent more this year.
While some find that hard to swallow, agriculture minister Bob Bjornerud said the increase could have been worse because the formula to determine lease rates calculated a 97 percent hike.
NDP agriculture critic Pat Atkinson said farmers find any increase unacceptable, given that grain prices have fallen.
She raised the issued with Bjornerud and his officials during an April 21 committee meeting about agriculture ministry estimates.
She said the minister froze the lease rates on grazing land because the livestock sector is struggling, “but you didn’t use that discretion to deal with the reality that grain prices have dropped.”
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The average rate this year is $23.40 per cultivated acre, although it will vary depending on soil type. Bjornerud said leaseholders received a letter this winter advising them of the change.
He said crown lease rates are still lower than rates in most private arrangements.
According to a 2007 provincial survey of private agreements, cash rental rates varied widely but averaged $23.54 per acre. The averages were highest in crop district 2b around Regina and Moose Jaw and lowest in district 4b in west-central and southwestern areas.
Bjornerud said producers are paying as much as $45 per acre this year near his home southeast of Yorkton.
Atkinson said farmers don’t understand why their leases increased so dramatically when prices dropped.
The formula to calculate the rate is based on data, including crop prices, from the last full crop year.
It is also wheat heavy, using 73 percent wheat, 17 percent barley and 10 percent oilseed prices.
“Right now that probably doesn’t reflect what farmers are growing, and that’s an area I think we have to reflect in the formula,” Bjornerud said in an interview.
He said the ministry is reviewing the formula as part of a review of all legislation. It is set out in regulations under the province’s Lands Act.
Atkinson said the government should re-examine the lease rate.
The province has 557,450 acres of cultivated lease land.
Grazing leases, which total nearly 4.9 million acres, are based on cattle prices in the fall of each year and are more responsive to market conditions.
The average grazing rate this year is $3.93 per animal unit month.
