Canadian farm debt is continuing to march higher but so too is the annual increase in the per acre value of farmland and farm buildings.
Nationwide farmers owed a collective $114.91 billion at the end of 2019, up about 8.8% from a year earlier and the 26th straight year of increase, according to a Statistics Canada farm income report released Wednesday. Meanwhile, the national per acre value of farmland and farm buildings as of July 1, 2019 was pegged at an average of $3,245, a rise of $173 or 5.6% from 2018 and also the 26th straight year of increase.
The rising debt load is becoming a major expense for farmers, with interest payments in 2019 up 16% to $4.21 billion, following a 19.6% gain in 2018, StatsCan said. Amid the increase in overall farm debt, average interest rates for 2019 were also higher, up 6.6% compared with 2018.
Ontario farmers remained the most indebted in the country in 2019, with farm debt in the province rising about 7.5% on the year to $29.72 billion. However, the per acre value Ontario farmland and farm buildings was also the highest in the land at $11,446, an increase of 5.2% from 2018.
Alberta farm debt was estimated at $25.55 billion at the end of 2019, up 6.5% from the previous year, while the average per value of farmland and farm buildings in the province gained $138 or 5.1% to $2,842. Saskatchewan debt increased 9.4% to $17.74 billion, and the value of farmland and farm buildings rose 6.7%.
Manitoba farm debt amounted to $10.56 billion versus $9.77 billion a year earlier, an 8% increase. The per acre value of farmland and farm buildings in the province as of July 1 was estimated at $2,201, up almost 4%.
Since 2000, national farm debt has increased roughly three-fold, while the per acre value of farmland and farm buildings has jumped almost four-fold.
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