Ontario Agriculture

The network for agriculture in Ontario, Canada

The CFFO Commentary: The Positive and Negative Roles of Farm Debt

By John Clement
January 14, 2011

Farm debt can be a contentious issue in farm circles. Used properly, and with clear sailing on the horizon, debt is a very practical tool for building a business. However, used improperly, or accompanied by stormy economic times, debt can be a millstone that strangles a business and limits future options.

The Christian Farmers Federation of Ontario is currently taking some time to re-examine the role of debt within farming businesses. Many of our members have become concerned for themselves, and others, regarding the place of debt due to several factors. While being supportive of entrepreneurship and the necessary commitment to manageable debt that goes along with it, many also remember turbulent times in recent decades and accompanying fluctuations in interest rates and land values.

Some of the reasons for our members’ concerns include the following:

  • Ontario farmers are some of the most heavily indebted farmers in North America.
  • There are indicators that interest rates could soon be on the rise
  • It’s become increasingly common for farmers to operate on an interest-only basis
  • Land prices and land rental rates continue to escalate at what many would view as unsustainable levels.

There are fears that this set of circumstances may be a recipe for disaster in the next several years. In addition, there are several admonitions in the Christian scriptures that caution about the perils created by uncontrolled debt. Accordingly, the CFFO is examining both the positive and negative aspects of debt in farming businesses at its policy committee meetings. We’re hoping that a pooling of research and experience will yield some proactive guidelines that we can eventually share with the larger farming community.


I think that the concerns of our membership are well placed. It’s not a nice picture to see hard-working families do everything “right” in their farming operations and then be taken down by fluctuations in financial markets. I’ve lived long enough to remember an era of farm gate defenses against creditors, “penny” auctions of assets, farm debt reconsideration processes, and farm families leaving their businesses and homes. Expressing caution, while being proactive in using and managing debt, just makes a lot of sense.



John Clement is the General Manager of the Christian Farmers Federation of Ontario. The CFFO Commentary represents the opinions of the writer and does not necessarily represent CFFO policy. The CFFO Commentary is heard weekly on CFCO Chatham, CKNX Wingham, Ontario and is archived on the CFFO website: www.christianfarmers.org. CFFO is supported by 4,200 family farmers across Ontario.

Views: 56

Comment

You need to be a member of Ontario Agriculture to add comments!

Join Ontario Agriculture

Agriculture Headlines from Farms.com Canada East News - click on title for full story

OFCAF Producer Perspective on Virtual Fencing – Cody Claypool

On a cold Alberta night, few jobs are less appealing than heading out to move polywire so cattle can keep making the most of a swath-grazing field. For producer Cody Claypool, virtual fencing offered a way to reduce that winter labour while still controlling how his herd accessed feed and helping capture the full value of swath grazing. Instead of bundling up in the dark to shift electric fence, Cody could check his cattle’s movements from the comfort of home — even in the middle of the night — and make management decisions from his phone. That practical fit is what made the technology worth trying on the Claypool operation, where Cody manages a herd of approximately 400 cattle and is always looking for ways to make grazing more efficient without adding more hours to already full winter days. Cody’s parents first learned about virtual fencing at an Alberta Stockgrowers meeting, where RDAR CEO Mark Redmond and Olds Researcher Briana Elliot gave presentations. Their interest was piqued

British Columbia organizations coming together to boost skills and talent training in Canadian food and ingredient ecosystem

As Canada works to reach its full opportunity to do more with what it grows, there’s an increasing need to train and produce skilled workers across the food production and value-added agriculture value-chain. Today, to help address this need, Protein Industries Canada is announcing a new project with BC Food & Beverage (BCFB), the University of British Columbia (UBC) and Cultivated Food Labs (CFL), to develop and deliver a new coordinated skills training program. Canada’s ability to Make More Here presents an opportunity to unlock $25 billion in GDP and upwards of 17,000 new innovation-based jobs. BCFB, UBC and CFL are combining their expertise to ensure enough skilled talent is ready to fill these jobs, providing companies across Canada with the workforce needed to help reach new growth potential and new markets. “A strong and resilient agri-food sector depends on a highly skilled workforce,” said the Honourable Mélanie Joly, Minister of Industry and Minister responsible for Canada

Barn Boards and Baling Wire

One morning when we still lived on the farm, I looked out the front window and saw the barn door was open. A horse was standing by the corn crib not 10 feet from the road. It wasn’t my horse, but still I had that sinking feeling in the pit of my stomach. We had rented out a stall to an Amish neighbor to board his horses for a month while he was doing some logging nearby. He paid the rent with several loads of firewood. As a bonus he spread some of that high-octane Percheron exhaust on the garden, so it was a good deal all around. The neighbor arrived within a few minutes to tend to the wayward horse, so it all ended well. But that sinking feeling brought back memories of all those times in my youth when somebody left a door or a gate unlocked and the cows got out – usually onto the road and almost always at the most inconvenient time. Chasing cows at three o’clock in the morning is not fun, especially when your school bus is due to arrive at 7 a.m. We came home recently after being

Grain Safety is Literally a Matter of Life and Death

BeGrainSafe Week encourages safe grain handling practices through education, rescue training, and awareness programs aimed at reducing preventable farm accidents across Canada.

Pre Harvest Glyphosate Timing Protects Crop Markets

Growers are encouraged to follow proper glyphosate application timing to reduce residue risks, protect grain quality, and maintain market access for canola, cereal, and pulse crops.

© 2026   Created by Darren Marsland.   Powered by

Badges  |  Report an Issue  |  Terms of Service