BMO's 2018 North American Harvest Report has some positive outlooks for Canadian agriculture, in particular Ontario where favourable growing conditions are expected to yield a record corn crop.
According to BMO's outlook, Canadian farmers in the country's largest agricultural regions saw composite crop yields – consisting of corn, soybeans, wheat and canola – come in below trend for a second straight season with challenging conditions on the Prairies, where hot, dry weather parched wheat and canola fields in the spring.
But in Ontario, farmers have seen more favourable growing conditions, which are expected to result in the largest corn crop on record.
Conditions in Ontario closely mirrored those seen in the United States. And coupled with the low Canadian dollar, Ontario producers are well-positioned to realize solid revenue this year. Rising interest rates and wages are expected to weigh on profitability.
The U.S. having a healthy harvest and for the sixth straight season, crop yields are expected to come in above trend.
As a result of helpful growing conditions, soybean yields are likely to reach a record high this year.
However, strong crop production is also weighing heavily on key U.S. crop prices.
Crop prices in the U.S. have also been weighed down by trade disputes, which are making some crop products more expensive for foreign buyers.
Rising costs and wages are also expected to put added financial pressure on U.S. agricultural producers.
