Cannabis has turned out to be a saviour for Canadian farmers, according to a report from Statistics Canada.

Had it not been for cannabis sales, national crop revenues would have declined 1.1 per cent, according to the report tracking the net income of Canadian agricultural producers in 2019.

The report defines net income as the difference between a farmer’s cash receipts and operating expenses, minus depreciation, plus income in kind.

In terms of the big picture, the net incomes for Canadian farmers last year rose for the first time in three years with cannabis-related receipts accounting for a significant increase.

Cash receipts — which include receipts from crop and livestock sales as well as program payments — rose 5.7 per cent in 2019 to $66.1 billion. But if sales of cannabis are excluded, the increase would have been only 2.9 per cent, so almost 50 per cent lower.

Breaking down the sales of crops, they totalled $36.6 billion in 2019, up 3.9 per cent from the previous year. Much of this gain though came from a $1.7 billion increase in licensed cannabis receipts during the first full year of legalized recreational use.

The report also includes what one might call a geographic surprise as Ontario and Alberta alone accounted for more 56 per cent of the national increase in crops sales. So British Columbia, the self-styled centre of cannabis in Canada, finds itself behind stodgy Ontario and conservative Alberta when it comes to profiting off marijuana.

Farmers are certainly betting on weed, based on their investments into equipment. Farm operating expenses (after rebates) increased 5.7 per cent in 2019 to $53.1 billion, with cannabis production accounting for just under 50 per cent in operating expenses.

According to the report, indoor growing areas of licensed producers almost tripled in the year following the legalization of recreational cannabis use in October 2018. Licensed outdoor production also began in 2019.

wolfgang.depner@peninsulanewsreview.com

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