ONTARIO GRAIN FARMER INDUSTRY NEWS 26 adding other types of livestock both in and outside supply managed systems also contribute. He goes on to say livestock-heavy areas “shine” when commodity prices are low since the value floor is much higher. Livestock density is also a driver separating southwestern Ontario’s 2010 to 2024 farmland value change rate—12 per cent—compared to 5.7 per cent experienced in the American corn belt over the same period, for example. Migration northwards is another reason values have notably increased in places like Grey County and the northern clay belt—the latter not being included in Parker’s analysis. He says there has not “been a big desire to turn the compass south,” even though farmers selling in higher-value areas would gain a good dollar-for-land value, plus additional heat units. URBANIZATION REDUCING THE LAND SUPPLY The elephant in the room, however, is the loss of farmland to development. “There is a certain pressure always on our land values, especially when we get closer to the central part of the province…a bubble around those urban centres that are always going to be there,” Parker says. “And we’ve got new things—the Volkswagen plant, the purchase in Wilmot outside Waterloo—we’ve got a lot of things moving and taking up more ground and more space, and that all means there’s less supply for farmers to buy farms.” Crinklaw, policy advisor with the Ontario Ministry of Agriculture, Food, and Agribusiness, says the near proximity of urban areas makes the correlation between farmland values and better soils harder to see. Development appears to trump commodity prices and interest rates, too. He reiterates the amount of farmland in Ontario is more-or-less fixed, while the number of buyers is expanding. In this environment, Crinklaw says even small increases in demand result in higher land prices. People moving from cities to properties in smaller towns and rural areas is one pool of buyers. Even if they’re not buying farmland per se, domestic mobility and a growing population generally necessitate expansions in housing, as well as all the infrastructure needed to build and support growth. This, again, often reduces the amount of farmland available for farmers to purchase from each other. “Demand seems to be somewhat insatiable,” says Crinklaw. “Not everywhere, but certainly parts of Ontario are getting crowded.” “In farming, the land is the business. Farming requires stable, longterm access to land. Without it, scaling can be a challenge…If you’re serious about establishing a long-term farm operation, planning for a secure land base must be a priority.” With this in mind, Crinklaw encourages farmers to pay attention to local planning and municipal Land Needs Assessments. This can continued from page 25
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