Crop Production Booming – Investing in AB Farmland is a positive
If you talk to a crop farmer, you’ll find out that the worst time to get excited about crop yields is right at the tail end of summer, because there are all sorts of things that can happen in the last weeks before the harvest, such as a plague of grasshoppers, a devastating hail storm, or a mysterious change in the rain patterns.
That hasn’t stopped Statistics Canada from forecasting that Alberta is headed to a terrific major crop yield in 2016. All three of the province’s major crops (canola, wheat and barley) are expected to come in well above the average yield from the last 20 years.
Barley’s predicted yield is about 4,000 kilograms per hectare, which is more than 20% above its 20-year average of about 3,300 kilograms. Wheat yields are predicted at 3,600 kilograms per hectare (compared to an average of 2,900), while canola yields are predicted at 2,300 kilograms per hectare (compared to an average of 1,800).
These predictions are still below the record levels of 2013, when a bumper crop drove all three yields to peak numbers. That was a terrific year for income for crop farmers in Alberta.
A lot of the factors that influence crop yield and development are at the whim of nature. There have been some improvements in farming techniques, crop science and other areas of technology that have driven average yields up, though. In the 1970s, wheat yields were about 75 percent lower than they have been since 2006.
There are six weeks left until harvest, so as long as Mother Nature doesn’t turn sour, the yields are looking terrific. Given the damage that low oil prices have done to the provincial economy, the farmers definitely need their luck to hold until the last crops are in the barn.
As an investor/private lender, if you are looking to invest and get a good return on good real estate, consider Alberta Farmland.