Economic Outlook "Bleak" For Canadian Farmers

Winnipeg, MB - A new Ipsos-Reid poll conducted by its Agribusiness, Food and Animal Health Division shows commercial farmers believe the Agriculture Economy is weak, and most farmers don't expect it to get better in the next six months. The BSE crisis continues to be the number one issue facing Canadian agriculture today while trade barriers, increasing farm input prices and low commodity prices are other frequently mentioned national issues.

Over one-half of the producers surveyed as part of a quarterly Canadian Farm Trends Report

rate the agriculture economy as very weak (55% rate 1 or 2 on a 7-point scale) while only 2% consider it to be very strong (6 or 7 rating). Beef producers have the most dismal view of the Canadian agricultural economy, with two-thirds giving the economy a `very weak' rating. Producers who report crops as their main farm type are not far behind with well over half assessing the agriculture economy as `very weak'.

Producers' expectations over the next six months show negative momentum with the percentage who say things will get worse (34%) over three times as high as the percentage who say things will get better (10%) . This result should not be surprising though, as crop quality is likely to be poor this year due to a cool and wet growing season and prices are being depressed because of an anticipated record corn and soybean harvest in the United States. The hog industry is also bracing for lower prices due to U.S. tariffs and cattle producers do not expect the U.S. border to open any time soon.

Farmers in the Prairie Provinces are the most pessimistic about the next six months. The outlook is poor in Alberta, a major cattle raising province carrying the brunt of the BSE crisis. And the situation is perhaps most distressing in Manitoba where producers are nine times as likely to expect the economy to weaken as they are to expect it to get stronger in the next six months. Manitoba producers are struggling with the harsh realities of the BSE crisis as this province has a record number of cattle on farms with no major slaughter facilities in place.

Producers in Atlantic Canada are the most optimistic about the strength of the economy over the next six months. Meanwhile producers in Quebec are the least certain. More than one in ten producers in Quebec are "unsure" about what to expect in the next six months.

In general, commercial farmers across the country share the bleak industry outlook, but the economic situation is a little more positive when farmers consider their own operations. Compared with their expectations of the agriculture economy overall, individual farmers are almost twice as likely to say that they expect their own financial situations to be stronger in the next six months.

For results by region and farm type please see our news release at www.ipsos.ca. This poll was conducted as part of the Canadian Farm Trends Report series, a quarterly poll of commercial farmers designed to provide the agriculture industry in Canada with an up-to-date, independent and authoritative information about the shifts and trends in producer opinion and activity.

These results are part of the findings of the Canadian Farm Trends Report poll conducted by Ipsos-Reid Agribusiness, Food and Animal Health between August 11 th and August 26 th, 2004. Telephone interviews were completed with a representative randomly selected sample of 875 commercial farmers with farm sales of $50,000 or more. With a sample of this size, the results are considered accurate to within 1773.3 percentage points, 19 times out of 20, of what they would have been had the entire Canadian commercial farm population been polled. The margin of error will be larger within regions and for other sub-groupings of the survey population. These data were weighted to ensure the sample's regional and farm type compositions reflect the actual Canadian commercial farm population according to the 2001 Census data.

For more information on this news release or the Canadian Farm Trends Report, please contact:

Elen Alexov
Director of Marketing Services
Ipsos in North America
778.373.5136
[email protected]

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Ipsos-Reid is Canada's market intelligence leader and the country's leading provider of public opinion research. With operations in eight cities, Ipsos-Reid employs more than 300 researcher professionals and support staff in Canada. The company has the biggest network of telephone call centres in Canada, as well as the largest pre-recruited household and on-line panels. Ipsos-Reid's Canadian marketing research and public affairs practices are staffed with seasoned research consultants with extensive industry-specific backgrounds, offering the premier suite of research vehicles in Canada-- including the Ipsos Trend Report, the leading source of public opinion in the country--all of which provide clients with actionable and relevant information. Ipsos-Reid is an Ipsos company, a leading global survey-based market research group.

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