Weaker average net operating income for Canadian greenhouse growers

The 2016 outlook for Canadian agriculture is positive. A low dollar, declining energy costs and better-than-average production helped push Canadian net cash income to record highs in 2015. And this happened despite lower commodity prices in some sectors.

While 2016 net farm income is expected to fall from those highs of one year ago, the outlook remains good - and those who produce fruit and vegetables are expected to bear some of the year’s best prospects.

Here are some highlights from Agriculture and Agri-Food Canada’s 2016 Canadian Agricultural Outlook:

Farm cash receipts will continue to grow across all four sectors (potato, vegetable, fruits and greenhouses) in the next year. Net income within these sectors is also expected to compare well to the 2010-2014 average.
The weaker average net operating income for greenhouses reflects anticipated growth in farm cash receipts between 2014 and 2016 of 5.3% and growth in expenses of 7.4%. While overall greenhouse revenues have grown since 2010, the growth rate has slowed since 2014.
Canadian food will in general cost more to produce in 2016. Each sector’s expenses are likely to grow more in 2016 than in 2015. Canadian producers depend on inputs and equipment from the U.S., which have increased in price because of the drop in the Canadian dollar relative to the USD.