Farm operators' total income

For a second consecutive year, farm operators saw a substantial increase in their average total income in 2001, according to analysis of data from personal income tax returns.

Average total income of farm operators grew 7.9% in 2001, to $46,998. The increase came as a result of an 11.3% rise in average net farm operating income (before depreciation), as well as a 5.2% increase in average off-farm income.

Starting in 2001, the Taxation Data Program adopted the North American Industry Classification System (NAICS), which includes poultry hatcheries within poultry and egg farms. This addition affects year-over-year comparisons for this particular farm type, as well as comparisons at the Canada level. If poultry hatcheries were excluded, average total income of farm operators would have risen 7.6% to $46,859.

Net farm operating income was supported by higher livestock and product revenues, as cattle and hog markets remained strong. Revenues from poultry and egg sales also rose significantly, mostly because of the addition of hatcheries. Higher program payments and insurance proceeds - resulting from poor growing conditions and increased payments from various income disaster programs - also accounted for the rise. Average off-farm income was mostly helped by higher average off-farm employment income.

Operators running hog and pig farms enjoyed a solid 18.2% growth in average total income in 2001, earning almost $71,000, well above the average income of all farm operators. This was the largest recorded increase in average total income for the third year in a row. The latest increase was largely the result of a gain of just over 22% in average net farm operating income, as prices and marketings of domestic slaughter hogs continued to rise. Increased revenues from hog exports, mostly to the United States, also helped to raise average net farm operating income.

Operators specializing in oilseed and grain farming, beef cattle ranching and farming, and fruit and tree nut farming saw the next largest percentage gains in average total income.

Farm operators specializing in greenhouse, nursery and floriculture production made much less money in 2001 than the previous year. Owing to a 43.9% decline in their average net farm operating income, those operators saw their average total income fall to $65,187 in 2001, down 24.1% from 2000. Lower revenues from the sales of greenhouse, nursery and floriculture products, along with higher energy costs, reduced average net farm operating income. Accordingly, these farm operators saw their average total income slip to fourth place in 2001, after ranking first in 2000.

In 2001, operators running poultry and egg farms posted the highest average total income, at $87,975, up 6.2% from 2000. Excluding poultry hatcheries, average total income of these operators dipped 0.7% to $82,304.

Among operators of farms of different sizes, those operating medium-sized farms posted the largest percentage gain in average total income, up 9.9% to $35,857 in 2001. These farm operators, however, saw their dependence on off-farm income increase. Their share of off-farm income, which includes employment, investment and pension income, government social transfers, child tax payments and the like, was just over 68% in 2001, up almost 2 percentage points from 2000.

Operators of large farms, which recorded the next largest increase in average total income (+8.2%), saw their reliance on off-farm income drop slightly to 36%. Overall, farm operators saw their dependence on off-farm income drop in 2001 to around 55%, the lowest share since 1997.

The publication Farm and off-farm income statistics (21-019-XIE, free) is now available on Statistics Canada's website (). From the Our products and services page, under Browse our Internet publications, choose Free, then Agriculture. Estimates for total income of farm families for 2000 were released in The Daily on July 7, 2003.

For custom data requests, contact Client Services (1-800-465-1991; agriculture@statcan.gc.ca). For more information, or to enquire about the concepts, methods or data quality of this release, contact Lina Di Piétro (613-951-3171, fax: 613-951-3868; lina.dipietro@statcan.gc.ca), or Sylvana Beaulieu (613-951-5268; sylvana.beaulieu@statcan.gc.ca), Agriculture Division.