Farm Credit Canada (FCC) reported another year of strong financial performance last year, capping 27 consecutive years of growth and innovation in Canada’s agriculture and food industry.
“FCC continues to be a strong and stable presence in Canada’s agriculture and food industry, ready to support producers and processors in pursuing opportunities and overcoming challenges,” said FCC president and CEO Michael Hoffort, in releasing the federal Crown corporation’s annual report.
“From the impact of adverse weather to market and supply chain disruptions caused by the COVID-19 pandemic, it’s important FCC continues to maintain a strong financial position to support those in Canada’s agriculture and food industry through these difficult times,” Hoffort said.
“We are the only financial institution 100 per cent invested in agriculture and food and we are committed to ensuring the industry emerges from this difficult period even stronger.”
In 2019-20, FCC grew its portfolio by 6.6 per cent to $38.6 billion, a reflection of the strength of the agriculture and food industry and their ability to invest in their operations. The portfolio included payment schedule adjustments to nine per cent of the total amount owing compared to four per cent in the previous year.
This increase was primarily due to pandemic-related support.
As part of the Government of Canada’s plan to support the economy from the sudden shock of the pandemic, FCC received an enhancement to its capital base that allowed for an additional $5 billion in lending capacity to support producers, agribusinesses and food processors through these uncertain times.
“Canadian farmers and food businesses have proven just how essential they are through COVID-19, and they will have a more vital role than ever to help lead our economic restart,” said Marie-Claude Bibeau, minister of agriculture and agri-food.
“Working with Farm Credit Canada, our government is ensuring farmers and food businesses get the timely support they need both to get through the tough times, and to take advantage of new opportunities.”
“As Canadian food exports this year are already up over six per cent compared to last year, it shows the importance of the work we are doing to position ourselves for the stability and growth of our agriculture industry,” Bibeau added.
As part of FCC’s mandate, the self-sustaining Crown corporation continues to invest in communities throughout rural Canada.
In 2019-20, FCC contributed $1.5 million to 94 community projects across Canada through the FCC AgriSpirit Fund, offered a wide range of free learning events and raised an equivalent of 16.2 million meals in conjunction with its like-minded partners through the FCC Drive Away Hunger tour in support of food banks across Canada.
It also contributed to a variety of mental health initiatives aimed at promoting awareness, as well as providing training and support through partnerships with the Do More Ag Foundation and 4-H Canada.
“Our role goes well beyond loan transactions,” Hoffort said.
“We look forward to continuing our support for young and new entrants, enabling intergenerational transfers of family farms, promoting greater diversity within the industry and supporting the growth of value-added enterprises to build an even brighter future.”
Other 2019-2020 financial highlights include:
– net income of $632.6 million, to be reinvested in agriculture through funding new loans and developing agriculture knowledge, products and services for customers.
– a dividend of $394.8 million paid by FCC to the Government of Canada.
– an allowance for credit losses level recognizing the accumulation of challenges in the Canadian agriculture and agri-food sector, including disruptions from COVID-19.
FCC has maintained a strong capital position and is in an even stronger position to support the industry through challenging times. With a $500 million pandemic-related capital contribution from the Government of Canada in March, FCC was able to increase its lending capacity by $5 billion.
FCC continues to provide free learning opportunities and economic insights through events, web, social media and various publications for all involved with the industry.
Due to the COVID-19 pandemic, FCC will hold an online version of its annual public meeting on Aug. 26th. Details will be posted on the FCC’s website and a full copy of the report can be found at www.fcc.ca/annualreport.
For more information, visit fcc.ca.