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Protect profitability: Key tools for farm financial fitness

Aug 27, 2025
2 min read

Farm income statements facing pressure 

Canada’s farm economy slowed down in 2024, so what’s ahead for farm income statements? 

Canadian farm cash receipts totalled C$97.9 billion in 2024. That’s a year-over-year decrease of 1.6% after reaching a new record the previous year. The decline was driven by crop prices falling 13.8% but was moderated by a 7.6% increase in livestock and animal product prices. Overall farm operating expenses grew in 2024: the farm input price index for crops fell 0.2% while the animal products index increased 1.5%. Farm net cash income (revenues minus operating expenses) decreased in 2024, to $19.6 billion.  

Looking ahead, farm cash receipts are projected to increase 8.5% in 2025, but given all the uncertainty stemming from global trade disruptions this forecast could come in lower. Both crop and livestock receipts are expected to grow in 2025, led by strong cattle prices due to a small North American herd size and strong exports of wheat and canola. Globally, agricultural commodity prices have been under pressure as markets face uncertainty in trade.  

Knowing this can help you anticipate the changes you may see in your income statement and identify efficiency gains to protect profitability in 2025.  

Analysis: overall asset values and debt increased 

The upward trend in Canadian land values continued in 2024 with an 9.3% annual increase. Strong demand for farmland, with fewer available listings, strengthened farmland values through 2024. We project a 4.9% average increase in farmland values in Canada in 2025.  

After four years of Canadian agriculture’s asset value growth being stronger than liabilities, assets grew 6.3% in 2024, with liabilities up 14.4%. Total asset growth is primarily due to higher farm real estate values which now represent over 79% of total farm assets. Even with slower growth in assets, the agriculture sectors net worth (owners’ equity, or assets minus liabilities) continued to grow reaching C$832 billion in 2024 (+4.8% over 2023).   

Farm debt outstanding is expected to grow 6.3% in 2025. Canadian farms are recording higher borrowing costs, even with easing interest rates. Despite reduced investments on equipment and buildings, demand for farmland remains strong for well capitalized producers who are seeing opportunities to enhance the efficiency of their operations. 

While the sector sees tremendous uncertainty stemming from global trade disruptions this year, overall, the industry is in a good financial position to endure a year of lean profitability.  

Are you comfortable using financial statements to better manage your operation? A good place to start is by visiting your accountant or an FCC Relationship Manager.  

Article by: Amanda Norris, Senior Economist