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Farm business cash flows
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Cash income for Canadian farm businesses rose to $9.0 billion in 2007, up $1.4 billion (+18.8%) from 2006. Higher grain and oilseed prices more than offset increases in operating costs. Meanwhile, many livestock producers were adversely affected by reduced prices, resulting from the appreciation of the Canadian dollar, and higher feed costs. The rebound in 2007 followed declines in 2005 and 2006, and was the highest level since 2002.
All provinces recorded increases in cash income, except Prince Edward Island, Nova Scotia and New Brunswick. This divergence was largely a result of the wide range of crops and livestock produced across Canada. Cash income declined in most Atlantic provinces as producers faced large rises in operating costs and declines in potato, hog and calf receipts.
Cash available to producers through borrowing increased in 2007, resulting in a $1.7 billion net increase in loans outstanding. Loans outstanding have increased for 14 consecutive years.
The amount of cash available for investment or withdrawal (cash income plus the net change in loans outstanding) increased 14.9% to $10.7 billion in 2007. This followed two consecutive annual decreases.
The loans outstanding to cash income ratio fell to 5.2 in 2007 from 5.9 in 2006. This ratio indicates the burden of farm debt on farm cash income. The high of 6.0 was set in 2003, while the record low of 2.7 was set in 1989.
Note: This series does not include data on depreciation, which are available in the publication Farm Operating Expenses and Depreciation Charges: Agriculture Economic Statistics (21-012-XWE, free).
Estimates of the farm business cash flows and other data contained in the Agriculture Economic Statistics series have been revised to align with data from the 2006 Census of Agriculture.
Available on CANSIM: table 002-0023.
Definitions, data sources and methods: survey number 5031.
The publication Farm Business Cash Flows: Agriculture Economic Statistics, January 2009, Vol. 7, no. 2 (21-018-XWE, free), is now available online. From the Publications module of our website, under All subjects, choose Agriculture.
For more information, or to enquire about the concepts, methods or data quality of this release, contact Bernie Rosien (613-951-1875; bernie.rosien@statcan.gc.ca), Agriculture Division.
