So you have three children who all want to farm.
Evidence of meeting #52 for Agriculture and Agri-Food in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was agriculture.
Evidence of meeting #52 for Agriculture and Agri-Food in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was agriculture.
2:30 p.m.
Liberal
2:30 p.m.
Liberal
2:30 p.m.
Risk Management, Weber Commodities
The oldest guy's usually out on the road, so the youngest guy gets the farm. That's how it goes.
2:30 p.m.
Liberal
Charles Hubbard Liberal Miramichi, NB
It's really quite a dilemma when you talk about everything. It costs so much to capitalize. If agriculture is as poor as you seem to present to this committee, why would anyone even want to think about it?
2:30 p.m.
Executive Director, Agricultural Producers Association of Saskatchewan
I don't know if this will provide you with the complete answer, but with property assets, the value is relative to the next best alternative. So it's partly opportunity costs that capitalize.
In Saskatchewan we have varying pressures that compete for farmland, besides farmers. We have conservation programs, for example, and I'll speak specifically about Saskatchewan. But we have this nifty little thing with land ownership. Conservation organizations find Saskatchewan a very lucrative place to preserve land for wild fowl and whatever. And they have deep pockets.
2:30 p.m.
Liberal
Charles Hubbard Liberal Miramichi, NB
But to get back to the basic question, if it costs so much to farm and most people say there's no money in it, why is the land so valuable?
2:30 p.m.
Executive Director, Agricultural Producers Association of Saskatchewan
This is why. You have other alternatives competing for that farmland and driving up the value of it. We see that here every day. If the competition were purely between producers, you wouldn't see that value. I pick on conservation organizations because that's our experience, but as soon as you have something else--and it doesn't matter if it's that or a company that wants to buy a parcel of land to build an ethanol plant and they have some capital--as soon as something competes for land, farmland values compete with that price every day. That's what drives the profitability up. It's absolutely not profitability in farming that does it.
2:30 p.m.
President, Pound-Maker
I'm not sure about that, but I think there are certainly a lot of farmers who are doing pretty well. I have some in my country. But the economies of scale are pretty significant to do that.
To get back to Larry's comment, you need to have a lot of help to be able to do that. Land isn't $60,000 in our country. We have a lot of land in our area selling at half that cost. It used to be farmland, and it's mostly being turned into grassland. My ex-patriate Saskatchewan people are going to grass it for the summer. So we're depopulating Saskatchewan at a record pace because of that.
It's finding its value, there's no question about that. But where the land is better there are big farms. When I went from grain farming to running our operation there, we farmed 6,000 acres. We were the largest farm in our area in 1985. Today several of them are 15,000 to 20,000 acres, so I think that's what's happening here. So at that price you can afford to—
2:35 p.m.
Liberal
Charles Hubbard Liberal Miramichi, NB
We can't all be discouraged by what we hear, I guess.
Thanks, Mr. Chair.
2:35 p.m.
Conservative
The Chair Conservative James Bezan
Thanks to all of you. We are out of time. It was a very interesting and good exchange. We appreciate your input and taking time out of your busy schedules to help us with our study on APF.
We are going to adjourn and travel on to Gimli, Manitoba.