Analysis conducted by Manitoba Agriculture shows most of the big acre crops should turn a profit in the province in 2022
Growers with average crops should have a profitable year in 2022, Manitoba Agriculture estimates.
Based on current cost-of-production, forward prices and expected yields, only barley looks to be a money loser among the big-acre crops on the eastern Prairies.
That’s in terms of “net profitability,” which includes costs for land, machinery and living costs. In terms of operating costs, all crops should be in the black in 2022.
That’s a product of high crop prices, despite high input prices. It is based upon the assumption of modest yields compared to long-term averages, but much higher yields than some drought-ravaged farmers got last year.
The best-returning major crops, based on today’s assumptions, appear to be oats, canola, northern hard red wheat and corn, with barley, soybeans and peas appearing the poorest.
Hard red spring wheat is in the middle.
If farmers are looking at the same bottom-line numbers, these projections should continue to favour canola acres and discourage soybean acres.
In 2017, soybeans were grown on 2.3 million Manitoba acres, but that has trended lower, to 1.3 million acres in 2021, which was a slight increase on 2020’s 1.15 million.
Despite relatively low production costs due to soybeans’ low fertilizer requirements, the low expected yields of 35 bushels per acre don’t compensate enough to raise it from the profitability basement.
Canola, despite challenges with clubroot and other tight-rotation issues, continues to be a steady money maker and a dominant crop on Manitoba’s farmland.
These are just Manitoba-wide calculations. Each farm would need to customize the numbers to fit its own averages and expectations.
A major factor this year affecting the actual production costs will be the true cost of fertilizer for individual farmers.
There has been a huge rise in fertilizer prices since 2020 and an increase since the fall 2021. The actual price paid by a farmer for fertilizer could be a significant factor in profitability, depending upon when they bought it and at what price. The price of fertilizer near seeding time is impossible to estimate, considering the supply chain problems bedevilling the world.
The Manitoba Agriculture analysis can be found in the 2022 Cost of Production — Crops report on the department’s website, under production economics.
