By Sean Pratt, The Western Producer, September 6, 2016
The debt-to-asset ratio of Canadian farms increased for the first time in six years. The ratio measures the solvency of farms. It indicates that for every dollar of assets there is an average of 15.5 cents of debt. Since 2010 the value of assets has risen 56 percent compared to a 43 percent increase in liabilities.
Canadian agriculture remains in good financial shape despite a softening of all the key financial ratios in 2015, says Farm Credit Canada.
Record farm income and solid asset appreciation have bolstered farm finances but 2015 was the first year in a long time that some of the key financial ratios weakened slightly.
