Farm Product Price Index

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Prices farmers received for their commodities increased in November 2007 from the same month a year earlier, as soaring crop prices continued to offset falling livestock prices.

Prices for crops were up 15.9% in November compared with November 2006, according to the Farm Product Price Index (FPPI), as only fruits and potatoes recorded decreases. Prices for grains, oilseeds and specialty crops continued their double-digit increase, a trend which began in November 2006.

Overall, prices for livestock and animal products were 6.9% below their November 2006 level as cattle, calf and hog prices continued to slide. This was the sixth consecutive year-to-year decline for these major commodities. Meanwhile, prices for supply-managed commodities continued their upward trend, moderating the decrease. Higher feed grain costs were a factor in the increases, ranging from 4.9% for eggs to 14.0% for poultry.

Prices farmers received for their commodities fell 2.6% in November from October, as declines were recorded in both the crops index and the livestock and animal products index.

The FPPI (1997=100) stood at 103.2 in November, down from a revised October index of 106.0.

The overall index for livestock and animal products decreased in November from the revised October index, as all prices except poultry (+0.1%) and eggs (unchanged) were lower. The cattle and calf index (87.0) fell for the seventh consecutive month to its lowest level since the fall of 2004. Falling prices pushed the hog index to its lowest level since December 1998.

Cattle and hog prices continued to be pressured by high feed grain prices and the rising value of the Canadian dollar. The value of the Canadian dollar in relation to its US counterpart rose 0.8% from October to November. Compared with November 2006, the value of the Canadian dollar increased 17.5%. Cattle and hog exports to the United States have increased rapidly as the economics of finishing these animals supported this movement.

The crop index slipped 0.3% as higher oilseeds, specialty crops and fruit prices moderated the losses in the other commodities.

Overall grain prices edged down in November, while oilseed and special crop prices were up. Continued supply concerns in many of the world's exporting countries have maintained prices at this higher level. Supply concerns have also initiated export restrictions on grain this crop year by some countries. In November, Russia imposed an export tax on wheat. The market focus now turns to the southern hemisphere harvest and its impact on total world supplies.

Available on CANSIM: tables 002-0021 and 002-0022.

Definitions, data sources and methods: survey number 5040.

The November 2007 issue of Farm Product Price Index, Vol. 7, no. 11 (21-007-XWE, free) is now available online from the Publications module on our website. Under Free internet publications, choose Agriculture.

For general information or to order data, call Client Services (toll-free 1-800-465-1991). To enquire about the concepts, methods or data quality of this release, contact Gail-Ann Breese (204-983-3445: fax: 204-983-7543; gail-ann.breese@statcan.gc.ca), Agriculture Division.

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