Ottawa - Canada's farm cash receipts, sideswiped by expanding global grain stocks and weak prices, fell 5.5 percent in the third quarter from the same period last year and are expected to continue their slide into 1999, Statistics Canada said.
The federal agency said farmers sold agricultural commodities worth C$7.04 billion in the quarter, down from C$7.45 billion last year. For the first nine months of 1998, receipts were down 2.6 percent to C$21.62 billion from the same period in 1997.
“The largest decline occurred in receipts for crops, which have been particularly affected by oversupply on world markets,” Statscan said in its daily release.
Revenues from crops fell 9.2 percent in the third quarter to C$3.23 billion and were 4.2 percent lower at C$10.17 billion for the first nine months of the year, with declining wheat revenues leading the slide.
Income from the sale of all wheat varieties tumbled 40.3 percent in the third quarter and 22.0 percent in the first nine months as expanding global stocks sank prices.
Feed grain receipts also tumbled, with barley down 48.8 percent in the third quarter and 28.7 percent in the first nine months. Corn revenue fell 29.7 percent and 25.0 percent in the same periods, respectively.
“Abundant world supplies of feed grains, the result of bumper corn harvests in the United States, have put downward pressure on prices over the last two years,” Statscan said.
Overall, the decline in revenue was less substantial in the livestock sector, where revenues fell 1.4 percent to C$3.6 billion in the third quarter from the same period last year.
Total livestock receipts fell to C$10.73 billion in the first nine months of 1998, down 1.3 percent from 1997, as increased receipts for cattle, poultry and milk failed to compensate for the freefall in the hog sector.
Hog revenues fell 26.1 percent in the third quarter and 21.6 percent in the first nine months as marketings rose sharply during the first three quarters of 1998.
Although net cash income of farm businesses reached a record C$6.8 billion in 1997, up 4.9 percent from 1996, Statistics Canada said the upward trend cannot last.
“If farm cash receipts continue to decline in 1998, which can be expected given current prices, net cash income this year will be down substantially,” Statscan said.
The financial picture for farmers in 1997 was much bleaker from the point of view of total net farm income, which is net cash income after adjustment for depreciation and other factors.
Statscan said revised data show that total net income plunged from just over C$4.3 billion in 1996 to C$2.0 billion in 1997, a decline the agency attributed to a 16.0 percent drop in December 31 inventories of major grains and oilseeds.
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