It turns out farmland is COVID-proof.
In fact, it may be even better than just COVID-proof.
Farm Credit Canada released its annual farmland values report on Monday, and it discovered the average value of Canadian land increased 5.4% in 2020, which was even more than the 5.2% it gained in 2019.
The average B.C. farmland increased 8% in 2020, which was more than the 5.4% gain in 2019 and the 6.1% jump in 2018. Last year’s 8% jump was the biggest of any Canadian province.
“Since land is the most valuable asset on any farm operation, the agriculture land market is a good barometer for measuring the strength of Canadian agriculture,” FCC chief economist J.P. Gervais said in a press release. “Despite having gone through a uniquely volatile year, farm income generally improved and the overall demand for farmland remained strong throughout 2020.”
The reason for the value increase was commodity prices climbed in the last half of 2020 for many crops and interest rates remained close to historic lows. Domestic demand for food remained strong, and global supply chains continued to have an appetite for Canadian food and commodity exports.
“Producer investments in farmland are a reflection of their confidence and optimism,” Gervais said. “Agriculture presents opportunities as producers seek to expand, diversify or transfer their operations to the next generation.”
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