Most farmers share a bleak economic outlook for agriculture over the next six months.
That was one of the key findings of an Ipsos-Reid poll of 875 commercial producers with farm sales of $50,000 or more.
It was a predictable sentiment given the lingering BSE crisis, disappointing crop quality and depressed grain prices brought on by record corn and soybean harvests in the United States, said Curtis Johnson, senior vice-president of Ipsos-Reid’s agribusiness, food and animal health division.
What does stand out in the Canadian Farm Trends Report is that farmers are a tad more optimistic about their own operations than they are about the industry as a whole.
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Compared with their expectations of the overall agriculture economy, individual farmers are almost twice as likely to expect their own financial situations to be stronger in the next six months.
Johnson said that contradiction can be explained by the fact that farmers tend to feel each other’s pain.
“When your neighbour is struggling, you feel it yourself.”
People in the dairy and hog sectors look at beef and grain farmers and scale back their expectations for the future of the agriculture economy, he said.
University of Saskatchewan agricultural economics professor Richard Gray had a similar explanation for why farmers put a different spin on the big picture than their own situation.
“They want to be careful that they’re not suggesting that agriculture in general is rosy because they know at least some farmers are suffering, so they suggest that agriculture is not that good.”
Even if their farm escaped frost damage, they know neighbours and relatives who weren’t so lucky.
“They don’t want to cast too positive a light suggesting that other farmers don’t have issues,” said Gray.
Of the producers polled, 55 percent rated the agriculture economy as very weak, while only two percent considered it to be very strong.
Some told Johnson they didn’t know if they would make it through the year. Others said they no longer make vacation plans or daydream about sending their kids to college.
“They’re not thinking about that now. They’re thinking about ‘what is my bank manager going to say when I go in this fall?’ “
One-third of those surveyed believe things will get worse over the next six months, while 10 percent say circumstances will improve.
Johnson said the situation is most distressing in Manitoba where producers were nine times as likely to expect the economy to weaken as they were to expect it to strengthen in the next six months.
“Manitoba producers are struggling with the harsh realities of the BSE crisis as the province has a record number of cattle on farms with no major slaughter facility in place.”
BSE topped the list of farmer concerns. Forty-seven percent of respondents named it as their first choice of issues deserving the greatest attention from Canada’s leaders.
Farm profitability received two percent of first mentions, while commodity prices and farm input prices were slightly higher up the list.
“The focus unfortunately is less on profitability than it is on maximizing revenue,” said Johnson.
“Some guys say, ‘I hate to figure out what my profit is because I find out I’m not paying myself.’ “
Grain marketing choice wasn’t weighing on farmers’ minds despite a Canadian Wheat Board directors election looming this fall. Johnson said that issue would have received a higher profile in the company’s Cereal Trends Watch survey.
“It is very dominant amongst the people focused on (the grain) side of the business.”
Genetically modified organisms, once a key concern for farmers, only garnered one percent of first mentions.
“It has fallen from the radar relative to other issues related to food,” said Johnson.
This was the first issue of Canadian Farm Trends Report, a quarterly publication produced for crop input suppliers, animal health product suppliers, financial institutions, marketers and policy makers. An annual subscription to the service costs $10,000. Individual quarterly reports are $3,000.
