BY: Kyle Larkin, Executive Director, Grain Growers of Canada
Farmers across Canada are no strangers to navigating challenges, but today’s economic pressures are testing their financial resilience in new ways. From rising input costs, shifting global markets to increased taxes to crop price volatility, farm financial health is under immense strain.
Markets are unpredictable, and trade tensions with two of our largest trading partners – the United States and China – only adds to the instability. As key export destinations, any shift in trade relationships or purchasing patterns can have a profound impact on Canadian grain farmers. Trade tensions, changing demand, or tariffs add another layer of risk to already tight margins.
At the same time, the carbon tax continues to compound financial pressures for grain farmers, affecting everything from drying grain to transporting crops to market. For a sector already operating on thin margins, these additional expenses make it harder for farmers to stay competitive both domestically and internationally, especially when no viable alternatives exist.
Adding to these pressures is the recent increase in the capital gains inclusion rate, which creates further uncertainty about the future of family-run grain farms. While intended to target Canada’s wealthiest individuals, these changes disproportionately impact farmers who rely on their land and equipment as their retirement plan.
Simply put, farmers are facing mounting financial uncertainty at every turn. Trade instability with China and the U.S., higher carbon taxes, and increased capital gains taxes are creating an unsustainable economic environment.
Yet despite these challenges, Canadian farmers remain resilient entrepreneurs. They continue to innovate and adapt while growing food for Canadians and the world. In response to these pressures, Grain Growers of Canada (GGC) has been working with policymakers to advocate for the financial health of family-run grain farms.
We continue to fight to secure exemptions from the carbon tax for the on-farm use of propane and natural gas for activities like grain drying. These exemptions help alleviate some of the added financial pressure, enabling grain farms to remain competitive. We are also focused on strengthening Canada’s trade relationships. Access to global markets is critical for Canadian grain farmers and we continue to work hard to promote market access, especially in the U.S.
GGC has also fought for changes to tax policies, including pushing back against the capital gains tax increase, which threatens the ability of many farmers to retire securely and pass on their operation to the next generation of farmers. By ensuring our policies foster growth, stability, and successful succession planning, family farms can remain viable for generations to come.
There have been several recent victories to celebrate that are helping contribute to the financial health of farms. After over a year of advocacy, we helped re-implement the recently phased-out Accelerated Investment Incentive, a tax measure that allows farmers to depreciate large capital investments like equipment more quickly.
We also played a crucial role in securing the right to repair for farmers. With the passing of Bills C-294 and C-244 this past fall, farmers will have more access to software, resources and tools that will allow them to repair their own equipment faster and affordably, particularly during critical seeding and harvest periods.
All these efforts are critical to the long-term viability of family-run grain farms. By advocating for policies that foster growth and reduce financial pressures, we are helping to ensure that the next generation of farmers can feed Canada and the world.
Family farms are the backbone of Canadian agriculture, and their financial health is paramount to allowing them to continue growing food and contributing to Canada’s economy. The government needs to be an equal partner with producers, because when farms succeed, Canada succeeds.