The average price of farmland across Canada increased 10.1 per cent last year but change could be coming.
A new report by Farm Credit Canada finds low interest rates and strong crop income kept demand strong in 2015.
Last year’s gains are part of an upward trend that started in 1993, but the chief agricultural economist at the agency says farmers should prepare for a potential softening of the market.
J.P. Gervais says farmers didn’t feel the full effects of lower commodity prices last year because of the significant drop in the Canadian dollar.
He says this year could see more modest farmland value gains of between two and four per cent as farmer income starts to be affected.
Lower crop prices have already increased volatility in the market.