The price of farmland in Canada has risen by 12% per year since 2008; this increase in the price of farmland has caused barriers for the entry of new/younger farmers to increase. This has caused potential farmers to reconsider their career paths as the initial “start up costs” are outweighing the potential profits of farming.

With increasing prices for Farmland, Potential Farmers are left with uncertainty.

Presently 75% of the current farmer’s do not have successors to their farms and most of these farmers on an average are 65 years of age, meaning that only 25% of farmer’s when they retire have someone who would be willing to take over their farms. This problem could lead to a shortage of farmer’s, as if no new farmer’s are willing to spend the initial start-up costs to buy the land needed for farming there will be a shortage of crops, which could mean supply of farm goods will diminish and prices will rise considerably which will affect the world economy due to the fall of supply.

It would be beneficial for farmland property prices to be made affordable to farmers and not linked to the residential property prices in the area.  This would increase the barriers to entry for local and overseas investors who are purchasing farmland, which is causing the increase in prices for the farmland.

Links

http://www.cbc.ca/news/canada/soaring-farmland-prices-a-crisis-in-the-making-don-pittis-1.2420223?cmp=rss