Farm cash receipt totals for the first nine months of the year were down across the Prairies, an early indication of what farm economists say will turn into a flood of red ink this winter.
A representative of the farm equipment manufacturing industry says farmers have been acting as if the flood has started already.
The equipment industry has recorded few sales. To the end of October, purchases of four-wheel drive tractors were less than half of year-earlier totals, mainly because of poor sales on the Prairies. Sales of self-propelled combines have fallen 36 percent this year.
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“There is no doubt that lower farm prices and incomes is part of the reason,” said Brent Hamre, president of the Canadian Farm and Industrial Equipment Institute.
“But I think it is just as much that farmers know or fear what is coming and they have decided to keep what money they have. This is no time for big spending.”
Hamre said the machinery business is bracing for a bad year of layoffs and closed plants.
Statistics Canada reported last week that to the end of September, farm cash receipts had declined nine percent in Saskatchewan, 6.7 percent in Manitoba and almost three percent in Alberta.
But those aggregate numbers masked the much sharper decline in cereal and hog sectors.
“Farmers’ income from the sale of wheat was worth $2.6 billion between January and September this year, down 22 percent from the same period in 1997,” said the federal agency. “Rising sales of durum wheat … could not offset plunging revenues for wheat used to make bread.”
Meanwhile, hog sector revenues declined 21.6 percent.
“Increased receipts for cattle, poultry and milk were not enough to offset the decline.”
Cattle receipts were up seven percent, mainly because calf prices have been high as cattle prices have fallen. Dairy sector income was up 3.5 percent with both higher prices and production and chicken sector revenues were up 3.4 percent, according to Statistics Canada.
