Ag Product Prices Slump to 1999 Levels

OTTAWA - Jan 24/06 - SNS -- More proof of the poor state of the farming economy was delivered by Statistics Canada today, which calculates that prices received for selling agricultural production since the August 1 start of the current marketing year have dropped back to 1999 levels.

Significantly, while returns for selling livestock are up sharply over last year, returns from selling grains and oilseeds have fallen off the map, pulling the entire index back to 1999 levels.

Prices Canadian farmers received for their commodities in November dropped 4.8% from year earlier levels as declines in crop prices swamped gains in livestock, says Statistics Canada, pushing returns from selling farm production to its lowest level since 1999.

Overall, producers received prices for crops that were 15.1% below levels in November 2004, continuing the downward trend in year-over-year price changes since the summer of 2003, according to the Farm Product Price Index (FPPI). Farmers received lower prices for grains, oilseeds, special crops and vegetables.

In contrast, prices for livestock and animal products were 4.8% above the year earlier level. Since June 2004, the overall livestock and animal products index has increased in all but one month (June 2005). Stronger cattle, calf and dairy prices have supported the increases over the previous five months, as hog, egg and poultry prices continued their year-over-year slide.

On a monthly basis, prices farmers received for their commodities were down 1.6% in November from October. Both the overall crops and the livestock and animal products indexes recorded declines from the revised October index.

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