Farmland prices in Canada highest in 29 years
Canadian farmland values rose 22.1% in 2013, up from the 19.5% achieved the previous year and indeed the fastest on records going back to 1985, Farm Credit Canada said.
The increase was led by the Prairies provinces of Manitoba - where values rose by 25.6%, extending an unbroken run of growth since 1992 – and Saskatchewan, where growth reached 28.5%.
The growth was fuelled by "low interest rates, growing world food demand and the resulting strong commodity prices in the first half of the year", said the lender, whose portfolio of borrowings exceeds Can$26bn.
Canadian farmers also enjoyed record harvests of canola, the rapeseed variant, and wheat last year.
However, Farm Credit Canada cautioned that most of the 2013 rise in land prices was seen in the first half of the year, and forecast that growth in farmland values should "slow down for the next several years" as the rally's two main drivers – crop receipts and interest rates – become less supportive. ■