Survey says: Latest census of ag shows farms getting bigger, more valuable

Canada’s most recent agriculture census reveals that farms are getting larger, and larger farms are netting the majority of total revenue.

On May 11, Statistics Canada began releasing data from its 2021 Census of Agriculture. This first instalment, which focuses on farm and farm operator data, shows that trends identified in previous census cycles (the census is released every five years), such as aging farmers and farm consolidation continue; however, it also revealed some new trends: more women are heading up farm operations, and Canadian farm operators are adopting more sustainable production practices and using more modern technologies.

The 2021 Census of Agriculture also showed that livestock inventories and acreage for Canada’s biggest commodity crops have remained quite stable, with some experiencing a modest increase.

Why it matters: The census is used by government, businesses, producers and academics to identify trends and understand what’s happening in Canadian agriculture.

A significant change to the census in 2021 was a change in the definition of what constitutes a “farm’. According to Statistics Canada, a “farm” or an “agricultural holding” now refers to “a unit that produces agricultural products and reports revenues or expenses for tax purposes to the Canada Revenue Agency.” In previous censuses, a “farm” was “an agricultural operation that produced at least one agricultural product intended for sale.”

The agency said this change in farm definition “may result in farms being classified differently across farm types than in previous censuses,” so “comparisons with earlier census results should be interpreted with caution.”

The 2021 census counted 189,874 farms in Canada, a decrease of 1.9 per cent from 2016, on total area of 153,687,771 acres, down 3.2 per cent.

This decline is noteworthy, as it’s the smallest seen in the last 25 years, according to Statistics Canada.

Of the 2021 total, 34.3 per cent of farms are in oilseeds and grains, followed by 20.9 per cent in beef cattle and feedlots; those two sectors combined account for 82.7 per cent of total farm area.

Consolidation continues

The trend of farm consolidation continues in the 2021 census. Statistics Canada states in its census summary that “over time, farms have been evolving to become increasingly sophisticated businesses that harmonize automation, modernization and production operations. As a result, many farms have consolidated and become increasingly larger both in terms of sales and number of employees. Conversely, smaller and mid-sized farms are declining in Canada, thereby impacting the rural landscape and profile of Canadian regions.”

The proportion of farms with sales of $1 million or more in 2020 was 9.9 per cent, up from 7.2 per cent in 2015.

Farms reporting at least $2 million in sales accounted for over half of Canada’s total farm operating revenues, at a share of 51.5 per cent, up from 41.5 per cent in 2016.

Farm operating revenues in Canada totalled $87 billion in 2020 against expenses of $72.2 billion, the agency said.

On average, for every dollar in revenues, farms incurred 83 cents in expenses. Farms classified as oilseed and grain farming were the most profitable, with an expenses-to-revenues ratio of 0.76; Sheep and goat farms had the highest ratio, at 0.97.

Farmers aging

The average age of Canada’s farm operators rose by one year in the last census to 56 in 2021. The median age of farm operators, however, increased to 58, up from 56 in 2016.

In 2021, 60.5 per cent of farm operators were age 55 or older, up from 54.5 per cent in 2016; Canada’s share of young (under age 35) operators, meanwhile, is 8.6 per cent, down from 9.1 in 2016.

For the first time since 1991, the number of female farmers increased to 79,795, and female operators now account for 30.4 per cent of the total number of farm operators.

This aging trend, suggests Statistics Canada, as well as the “challenges associated with the COVID-19 pandemic,” may have played a role in an increased proportion of farms in Canada reporting a succession plan — now at 12 per cent, up from 8.4 in 2016.

The census also points to a continuing decline in the number of farm operators, at 262,455 in 2021, down from 271,935 in 2016. In 2016, there were 271,935 farm operators, and by 2021 the number decreased to 262,455.

The number of farm operators working off the farm in 2020 increased by 3.8 per cent from 2015. Of that number, full-time off-farm workers made up 66 per cent, down from 68.1 per cent in 2015.

Large increase in farm value

The new census showed a big rise in farmland values, with contributing factors including “strong commodity prices, low interest rates and a growing demand for housing in urban areas,” said Statistics Canada.

The market value of farms has risen since the last 2016 census by more than $509 billion to $690 billion. The latest numbers show total farm capital has more than doubled in the last decade, up from $330 billion in 2011.

The total value of farmland and buildings has risen by 22 per cent since 2016 to $603 billion and has skyrocketed since 2011’s $276 billion valuation.

While the value of farms continues to go higher, the number of farms is on a downward trend.

In 2011, Statistics Canada reported 205,000 farms. The number dropped to 193,000 in 2016 and 189,000 in 2021.

Also on the rise is the value of farm machinery and equipment, rising nearly four per cent from 2016 to $64 billion.

Sustainable practices increase

Among farm practices, Statistics Canada noted an increase in the use of sustainable land practices such as in-field winter grazing or feeding, rotational grazing, winter cover crops and shelterbelts, at 64.5 per cent of farms in 2020, up from 53.7 in 2015.

The number of farms growing organic products increased 2.2 per cent from 2016.

Also, 11.9 per cent of farms reported “some form of renewable energy production” such as solar power or others in 2021, up from 5.3 per cent in 2016.

Other technologies measured in 2020 were automated guidance steering systems (up 28.2 per cent from 2015) and geographic information system mapping (up 58.6 per cent).

On average, for every dollar in revenues, farms incurred 83 cents in expenses. Farms classified as oilseed and grain farming were the most profitable, with an expenses-torevenues ratio of 0.76; Sheep and goat farms had the highest ratio, at 0.97.

Farms in Canada also reported a 23.2 per cent increase in total greenhouse area to 330.5 million square feet in 2021. Of that total, 66.5 per cent was in fruit and vegetables. It is worth noting that this figure does not include cannabis operations. Although Statistics Canada gathered data on cannabis for the first time in the 2021 census, data on this sector will be released separately later this year.

More direct marketing

Statistics Canada noted a shift in how small farms growing fruits and vegetables sell to consumers. Increasingly, these operators moved to direct delivery rather than selling from stands. Half of the farms that reported direct sales used delivery.

Overall, farms that use direct sales grew from 12.7 per cent to 13.6 per cent. The number rose from 24,510 in 2016 to 25,917 in 2021.

Farms with sales of less than $10,000 represent nearly 48 per cent of farms that rely on direct sales for three-quarters of their total operating revenue. Conversely, farms with $2 million or more in sales account for just 0.8 per cent in the same category.

More data to come

The next census instalment to be released by Statistics Canada will include provincial and territorial profiles, mapping tools and community profiles. It will be available June 15, said Statistics Canada.

The agency data linking agriculture with population will be released at a later date.

All data from the 2021 census, as well as older reports, will be available on the Census of Agriculture online portal.