Potato farmers struggle with low profit margins
Margins more than 4% below the national average
P.E.I. potato growers make the lowest profit margins in the country and that means many are just a bad crop away from going under.
Margins are at 1.82 per cent. The Canadian average is 6.15 per cent, while New Brunswick's is 6.54 per cent.
The industry research group P.E.I. AgriAlliance said 40 per cent of Island potato growers are making very little.
"P.E.I. farms on average have experienced an unmistakable long-term decline," said the AgriAlliance in its report, Innovation Road Map for the Prince Edward Island Agriculture & Agri-Food Sector, released in February.
The report also stated that the reasons for the profit-margin discrepancy are: " higher transport costs; taxation levels — to be improved upon the introduction of HST; lack of premium returns for P.E.I.-branded products, revenues earned by non-potato crops; and input costs."
David Best has farmed for 55 years, but this spring he can't afford to put a crop in.
"The margins are so slim that if you make one slip you're drowned," he said.
Gary Linkletter, farmer and chair of the P.E.I. Potato Board, is also struggling.
"On our farm we used to figure we had three crops before we'd go bankrupt. Now one crop will drive you bankrupt if you were to lose a crop. The input costs, the fertilizers, the chemicals, the land rent, everything has gotten so expensive," said Linkletter.
Most Island potato farmers are taking out higher coverage for crop insurance than ever before. Over the years they've lost too much to disease and poor weather.
Others are getting out all together.
The potato board said 100 farmers over the last decade either retired or gave up.
"It's been continuous attrition, and at this point that trend line has not changed. You'd think after a while it would bottom out, but so far we continue to see that linear shrink of farmer numbers," said Linkletter.
But Linkletter doesn't think it's a crisis. He said the solution is more research and cooperation.