Alberta ranchers and farmers set record realized net income in 2022

After nearly 40 years in the field, Dave Bishop is well acquainted with the economic ups and downs of farming.

“Everything is very variable and that’s why our margins are so thin — because we never know usually what our input costs are going to be and then what we’re going to get for our crop,” said Bishop.

As his new crop sprouts, a recent report from ATB is highlighting an all-time-high performance for Alberta’s Ag and food industry.

According to Rob Roach, ATB deputy chief economist, realized net income increased 2.6 per cent in 2022 to reach an all-time high of $3.3 billion – despite expenses rising nearly 25 per cent, to $16.6 billion, and depreciation charges up 9.5 per cent to $2.4 billion.

“We had record income, record expenses, fertilizer, fuel, things that farmers need were also higher, but you put the two together and luckily it did have that record level of net income,” said Roach.

“That’s a huge thing to try and offset, but the volume of the yields that were coming out of the fields – more crops were able to be grown. We had a pretty good summer weather-wise last year and that combined with record high comodity prices (which) meant revenues were even bigger than the expense side,” said Trevor Lewington, CEO of economic development Lethbridge, who said these figures prove there are growing opportunities in the region.

“If you’re in the business of food no matter where you participate, you should be here, you should be southern Alberta,” said Lewington.

It was a different story nationally as the realized net income dropped by 9.5 per cent in 2022.

Roach attributes that to the industry coming off a high year in 2021, adding that Alberta’s gain is due to the balanced crop and livestock industry.

“That’s a provincial total, so it’s good, but it doesn’t mean every individual farmer necessarily did well,” said Roach.

To maintain his business, Bishop takes a 5-10 year average of gains and losses to see how his farm is performing.

Looking into 2023, the ATB report expects commodity prices and expenses to come down, but Bishop expects farmers will need an above-average crop if they’re to see another strong return.

“If it stays dry like it has been, we’re probably looking at a loss year overall,” said Bishop.

That means the 2023 harvest year is a game of wait-and-see, for now.

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