By Tom Collins
Farmland prices in Ontario continue to climb, said a report from Farm Credit Canada (FCC).
The annual farmland value report said Ontario prices were up 4.4 per cent last year over 2015. For the first time, the FCC broke Ontario down into eight zones:
• Southern Ontario, consisting of Elgin, Chatham-Kent, Essex, Lambton and Middlesex counties, was up 6.9 per cent. This was the highest of any zone.
• South western Ontario, consisting of Oxford, Perth and Huron counties, was up 1.6 per cent.
• South central Ontario, consisting of Hamilton, Peel, Wellington, Halton, Waterloo and York counties, was up 5 per cent.
• North Western Ontario, consisting of Dufferin, Bruce, Grey and Simcoe counties, was up 4.2 per cent.
Statistics Canada said the average Ontario farmland price was $10,063 per acre in 2015. That’s almost double what it was in 2009 when it was $5,036 per acre and about three times the amount it was in 2001 when prices were $3,028 per acre.
The FCC said there was strong demand for farmland in some areas within southern and south central Ontario, as favourable soil types allow for a variety of specialty crops and create potentially higher returns.
Alister MacLean of Sutton Group Select Realty Inc. in Ingersoll near London, said good quality land consistently stays high and marginal land has wider price swings, but it’s livestock farmers who drive prices.
“It’s the dairy farmers expanding their land base, for all the reasons that they need it, for feed, for manure, and the inability to find more quota,” he said. “They need to expand, and it either goes to machinery or land, and land is a far better investment. You’ve got the poultry guys, same thing. And the hog guys have been putting some pressure on the land as well.”
Re/Max real estate agent John Jantzi, based out of Woodstock, said while there is no pressure for farmers to buy land to expand, they want to.
“There are a lot of big players out there that are looking to buy more land, and if something comes for sale, they want to expand,” he said. “It’s not that they’re buying another 100 acres because they want to expand their farm, but it’s 100 acres come for sale and they can buy it so they buy it.”