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Canadian farmland values continue to soften amid uncertainty, FCC reports

The average value of Canadian farmland increased by 5.2 per cent in 2019, the smallest increase over the past decade, according to the latest FCC Farmland Values Report.

The 2019 increase follows gains of 8.4 and 6.6 per cent in 2017 and 2018, respectively, and becomes part of a five-year trend of softening growth in average farmland values.

Fluctuating commodity prices, global trade uncertainty and difficult weather patterns are thought to be central factors in the slowed growth, despite the strength of the Canadian agriculture industry.

The highest provincial increases in 2019 were observed in two of the Atlantic provinces: Prince Edward Island with an average increase of 22.6 per cent and New Brunswick with an average increase of 17.2 per cent.

Ontario, Quebec and Saskatchewan reported average increases slightly above the national average at 6.7, 6.4 and 6.2 per cent, respectively, while British Columbia was closest to the national average at 5.4 per cent. Manitoba, Alberta and Nova Scotia had average increases below the national average at 4, 3.3 and 1.2 per cent, respectively.

For the fourth consecutive year, there was an insufficient number of publicly reported transactions in Newfoundland and Labrador to fully assess farmland values.

The COVID-19 pandemic makes the current economic environment challenging for farm operations and business owners throughout the entire food value chain. This year’s Farmland Values Report reflects factors that influenced average land values and prices in 2019, prior to the COVID-19 pandemic. Any impact from the pandemic will be captured in future reports.