Quebec Farm debt – a positive lever of development
The Union des producteurs agricoles (UPA) finds a new research report, entitled L’endettement des fermes au Quebec: un portrait contrasté, very interesting. It was produced by the Institut de recherche en economie contemporaine (IREC).
The report confirms that the average rate of indebtedness on Quebec farms is high when compared to the Canadian whole, but that it is not “excessive” considering the positive effect of the borrowing strategy of producers. This strategy, which stems from financially hefty Quebec agricultural policies, actually permits the producers to increase their capacity to invest their capital and to be more profitable.
According to the UPA’s chief economist, Charles-Felix Ross, “Our income security programs and the mechanisms to put them in place allow our agricultural enterprises to perform and be present all over the territory. This ability to borrow in relation to higher and more stable net revenues explains the level of indebtedness and its use as an economic lever of development.”
Visit www.irec.net to see a copy of the report.