By Paul Vieira
OTTAWA--Canada's farming sector likely earned record income last year, the federal agriculture department says, adding that officials forecast profit this year to fall but remain well above near-term historical averages.
Agriculture and Agri-Food Canada said Friday that based on preliminary figures, net cash income -- or the difference between cash receipts and operating expenses -- rose 13% in 2023 from the prior year, to a record 24.8 billion Canadian dollars ($18.4 billion). The gain was driven by the livestock sector, as prices for cattle in the western Canadian province of Alberta rose 36% last year in response to drought conditions.
Operating expenses for the farming sector are expected to have slowed in 2023, the agriculture department said, citing a fall in prices for fuel and fertilizer, which peaked in 2022 because of the conflict in Ukraine.
Overall, the average net operating income per farm, which measures producers' revenue minus cash expenses, likely rose 17% in 2023 from the prior year, and climbed 34% higher than the previous five-year average.
Statistics Canada is set to release fourth-quarter income data for the agricultural sector later this month. Output from primary agriculture in Canada represents about 2% of the country's gross domestic product.
Meanwhile, Canada's agriculture department said farm income in 2024 is expected to fall 14% from 2023 levels.
Still, officials said expected income of C$21.3 billion this year would be 28% above the 2018-2022 average, and represent the fourth-best year for income on record.
The most recent inflation data, covering December, indicated that Canadians paid 4.7% more for food at grocery stores from a year ago. Since the start of the pandemic, in March 2020, total food prices, purchased either at a store or from a restaurant, have climbed 22%.
Write to Paul Vieira at paul.vieira@wsj.com
(END) Dow Jones Newswires
02-16-24 1527ET
