Economic drivers to watch for in 2013

Wednesday, January 2, 2013

by BETTER FARMING STAFF

Farmers shouldn’t let higher receipts from 2012 crops keep them from seeking more efficiencies and productivity gains as they head into the new year. That’s one of several economic drivers Farm Credit Canada’s (FCC) chief agricultural economist J.P. Gervais says farmers should focus on in 2013.

In an FCC news release, Gervais says farmers can look forward to continued increases in demand for agricultural products from emerging markets such as India and China. He also says world inventories of major crops continue to be tight which could lead to higher crop prices, “but also high input costs for livestock producers.”

Noting that Canadian farmland appreciated on average by 8.6 per cent over the first six months of 2012, Gervais says the outlook for future farmland values rests with interest rates and crop receipts.

Barring the unforeseen, Gervais says it looks like crop prices will remain high and interest rates will remain low at least into the second half of 2013.

He also says farmers should keep an eye on free trade negotiations with the European Union. “It could open up new markets, but could also trigger more competition in Canada.” BF