Despite continuing BSE woes and a poor 2004 crop in many areas that mainly will affect farm incomes next year, 2003 is shaping up to be a good revenue year for many farmers, according to Statistics Canada.
Strong sales from a decent 2003 grains and oilseeds crop, good hog prices and record program payments meant that Canadian farmers saw higher revenues for the first time in three years despite continuing low cattle returns.
The figures for the first nine months were published by Statistics Canada recently and do not take account of rising farm input costs. Net farm income numbers for 2004, deducting costs from revenues, will not be calculated until early next year.
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The agency also made the point that general numbers do not necessarily find themselves reflected on every farm.
“Cash receipts can vary widely from farm to farm because of several factors including commodities, price and weather,” said the Statistics Canada commentary. “In addition, the impact of the closure of the U.S. border to Canadian cattle and beef on May 20, 2003, will continue to be reflected in financial statistics. The impact on other sectors of the economy, such as meat processing and transportation, is not covered here.”
For the year, Alberta farm cash receipts are up almost 15 percent and Saskatchewan has seen an increase of almost eight percent.
A part of the main story is the fact that gross receipts from delivery of last year’s grains and oilseeds crop, including higher oilseed prices this year, boosted receipts. Canola revenues increased more than 50 percent from 2003 to $1.7 billion during the first nine months of 2004.
Hog sector revenues increased 20 percent to a record $3.1 billion, based both on record export revenues and strong domestic prices.
By contrast, revenue from cattle and calf sales fell 11 percent to $3.4 billion, the lowest level in almost a decade.
“The cattle sector’s receipts remained 30.2 percent below the previous five-year average,” said the analysis.
Meanwhile, a combination of BSE funding and record withdrawals from Net Income Stabilization Accounts meant program payments during the first nine months of the year reached a record $3.1 billion. They were more than four percent above last year’s record level and almost $1 billion above the five-year average.
Withdrawals from NISA accounts totalled $819 million as farmers moved to close them under rules established by the Canadian Agricultural Income Stabilization program.
BSE special payments during the nine months were more than $500 million, according to Statistic Canada.
Meanwhile, crop insurance paid out $526 million, less than half of the total paid during earlier drought years. However, the federal agency warned this year’s frost and harvest problems will increase claims and reduce crop receipts to be reported next year.
