EASTERN ONTARIO — The rise of farmland prices in Central East and Eastern Ontario outpaced the province as a whole last year, according to Farm Credit Canada’s annual report on farmland values.
While FCC reports Ontario overall saw a 4.7 per cent increase in farmland prices in 2020 — down two percentage points from a year earlier — Eastern Ontario clocked in with a 6.4 per cent rise. “Central Eastern Ontario” — that chunk of the province between Kingston and Toronto — experienced an even higher increase, at 8.9 percent.
The “Central West” region, where the average acre sold for $19,600 (up 8.2 per cent from a year earlier), topped out at $32,900. The Eastern and Central Eastern regions, by contrast, saw respective average per acre prices of $8,700 to $8,200, while the most expensive farmland sold for $18,000 per acre.
Iroquois-area farmland realtor Marcel Smellink described land prices as initially “holding steady” in 2020. His sales were initially slow, leading into a dry summer “where the crops weren’t looking too good.” But optimism returned with a great soybean harvest and accompanying strong prices for both that commodity as well as corn.
“By December, the phone started to ring more and demand for land was up.”
Demand outstrips supply, particularly for operating dairy farms with about 100 kg of quota, he added. “I could sell five dairy farms right now, no problem.”
FCC reports that demand for farmland did indeed remain strong across the country last year, despite a noticeable decline in sales during the first six months of 2020, especially in April and May amid the early challenges of the pandemic.
“However, the total number of sales for the entire year was like those of the past few years. Despite a challenging global economic environment, commodity prices increased considerably in the last half of 2020 for many crops, and interest rates have reached historic lows,” it says.
The rise in Ontario’s farmland values lagged slightly behind the Canadian increase of 5.4 per cent. B.C. led the pack at 8 per cent, followed by Quebec, Alberta and Saskatchewan, where farmland prices respectively rose by 7.3 per cent, 6 per cent and 5.4 per cent in 2020.
