Thank you, Mr. Chair.
As you said, I'm Paul Glenn, the past chair of the Canadian Young Farmers' Forum. With me today is Justin Williams, our Ontario and Quebec director.
I would like to thank you for the opportunity to speak to you today about the very important issue of farm debt and its effects on young farmers.
I, myself, am a third-generation farmer from Keene, Ontario, growing soybeans, corn, wheat, and hay.
Agriculture is such a vast industry. Each sector has its own challenges in financing capital and operating capital, especially. With crop production, land values vary, from upwards of $100,000 an acre in B.C. to $100 an acre across Canada. This depends on the region in which you live and what type of climate you need to support the crop production and the cost of land.
On the high end, you have high-value crops, like flowers, blueberries, cranberries, and greenhouse production. That is just the start, which does not include any input or infrastructure costs for greenhouses. On the lower side, you have the cost of pasture land.
We do have some very savvy young farmers creating new farmland in the Yukon and also in Newfoundland, but it isn't easy. Not that much in farming is easy, I have found.
For young farmers transitioning between generations, I find it is more and more difficult with higher debt loads, rising costs of production, variables on crop sales, and also retirement planning for the exiting generation. People are living longer and need more income to retire, which adds complexity to transitions and requires extensive planning to complete successfully. Start-up farms, operating 10 years or less, are still in a growth phase, expanding their market share and clientele, servicing debt, and incurring debt to grow. This is one of the most important times, especially for young farmers. They are starting families and transitioning from previous generations. That's when they need the most support with strong financing, operating capital, and income stabilization programs to continue to operate and grow their businesses.
The ability to grow current operations is also tough because of increasing land input, equipment costs, and lower margins, which make debt servicing more difficult. The economy of scale is also variable for every operation and commodity, so having support for variable operations is a must.
Young farmers are diversifying their agribusinesses to help stabilize income streams. That is why supply-managed sectors are typically very attractive to young farmers, but they are very capital-intensive.
On that note, I'll pass it over to Justin Williams.