FCC posts slightly lower profit, loans $3.2B to young farmers

Farm Credit Canada’s annual report released Thursday showed the federal Crown corporation based in Regina posted a net profit of $613.8 million, down slightly from the previous year of $615.5 million.

“We had a very successful year. We were able to kind of have some real impacts that relates to some work with young farmers in some areas in agri-business and agrifood side of things as well,” said Michael Hoffort, president and CEO.

The 2016-17 report showed FCC grew its portfolio by $2.6 billion to $31.2 billion in loans to farmers, processors and suppliers throughout the agriculture value chain.

“There was growth in all sectors of our business and we really feel that we grew in step with the industry’s growth as it relates to debt growth,” Hoffort said.

The 2016 growing season was hard on farmers in Saskatchewan and Alberta, with around a million acres of crop left out in the field over winter in both provinces, which led FCC to adjust payment schedules on almost 300 loans.

“In a few cases we did some work with some of those customers. But in many cases they said, ‘Look we’re OK for now. We’re going to be able to kind of work our way through our payments as they fall due,’ ” Hoffort said.

Overall, Hoffort said, FCC did not see a huge increase in debt with more than 99 per cent of its portfolio being in good standing at the end of March 31 fiscal year.

“The biggest thing for FCC is our organization goes as the industry of agriculture and ag food goes. So I would say our results are very reflective of a very strong agriculture industry from coast to coast,” Hoffort said.

As well, FCC loaned more than $3.2 billion to young farmers over the year. And as part of the Crown’s efforts to support young people wanting to enter or establish themselves in the industry, FCC doubled the borrowing limit on its Young Farmers Loan program to $1 million and introduced the Young Entrepreneur Loan for the agriculture retail, manufacturing and food processing sectors.

The Statistics Canada Agriculture Census released in May

The biggest thing for

FCC is our organization goes as the industry of agriculture and ag food goes.

showed the number of farmers under the age of 35 increased by three per cent from 2011, which was the first increase in the age category since 1991.

“I wouldn’t say our organization by any means can take full credit for that increasing number of farmers under the age of 35. But I think we have played a role in some way to support that next generation that’s coming in,” Hoffort said.

Even with the larger number of younger farmers, Hoffort said the organization is still paying attention to the older population as the ag census showed an increase of the average age of farmers from 54 to 55.

“Even with that growing younger group, there’s a lot of assets that are going to need to transfer over the next decades and we’ll try to be a part of that solution,” he said.