Farmers can lock in some pretty decent profit margins right now.
The Chief Agricultural Economist for Farm Credit Canada JP Gervais says commodity prices are expected fall lower as global grain stocks remain high and in some cases increase.
Gervais says the one key factor for us right now is our low Canadian dollar:
“I really do think that at the end of the year, we’re going to see a Canadian dollar that is higher than where it is right now. But having said that, it’s not going to be in the 75 cents range – it will probably be below 75 cents – and that really helps overall profits,” he said.
Gervais says despite the lower interest rates he expects farm debt and the growth to slow down.
He notes farm debt is expected to climb with farm input costs are still going up while farmland values will probably stabilize.