Not Our Grandparents’ Farm: Why Modern Farms Need More Than Soil to Grow
Gone are the days of the small family farms, where the farmers worked the land, had a variety of crops and livestock, and were sufficiently profitable to support their own needs and be able engage in meaningful local trade. The Canadian agricultural industry is a completely different landscape, placing higher demands on producers with fewer rewards. Despite remarkable growth in this sector in the past few decades, with crop production six times greater and animal production four times greater than in 1960, our agricultural productivity has stagnated, leaving farmers to grapple with steadily declining marginal profits (Herbert, 2024).
At the recent Productivity Summit hosted by the School of Public Policy, one message was clear: agriculture must embrace innovation to survive in a changing world. The traditional model of farming is being replaced by one that demands efficiency, technological innovation, and strategic adaptation. In short, farmers are becoming producers, and producers need to get more out of their farms by diversifying and improving outputs without relying just on land expansion.
The agricultural sector is vital to the Canadian economy, contributing $31.7 billion to GDP and employing nearly 250,000 people (Canada, 2024). To maintain this elementary role in the Canadian economy, the industry must adapt to new demands, focusing on maximizing production within its existing borders. Farms of all sizes and production levels need to embrace alternative revenue sources and boost their production; this can not only be done on large-scale operations.
Farmers today navigate a more complex business environment than ever before. They juggle the roles of farmhands, managers, entrepreneurs, accountants, sales, and research and design. This task is overwhelming and strains farmers’ capacity to focus on production growth and technological adoption.
To improve productivity and profitability, farmers must redirect their attention from expansion to streamlining operations (Gervais, 2024). Agri-tech and AI are invaluable tools which, when used correctly, provide data-driven solutions to optimize yields, enhance sustainability, and support long-term practices aligned with net-zero initiatives (Betts, 2024).
Farmers need to prioritize growth and enhance risk management programs (Slingerland, 2024). To do so, farmers must embrace technology and data to drive operational decisions (Hebert, 2024). AI is a tool which allows farms to do more without needing to expand their structural resources (Hunter, 2024). It offers time- and cost-effective solutions by optimizing production and supporting sustainable practices through real-time data analysis. The agri-tech industry is rapidly growing in both Canadian and global markets, improving efficiency, time management, farm safety, and productivity.
However, there is a huge hurdle to agri-tech adoption: most farmers do not yet have the time, knowledge, or capacity to integrate technological advancements and maximize their outputs (Hunter, 2024). Technological adoption by farmers remains low due to high costs and integration complexity. Canadian farmers are an aging population, averaging between 56-60 years old, and with that comes an unwillingness or inability to embrace technology. This has stagnated our agricultural sector when compared to other global agricultural leaders. Declining revenues and increasing instability have deterred entrepreneurs, leaving the agricultural sector vulnerable. Logistical and generational challenges—along with limited knowledge and financial resources—hinder widespread adoption. Providing targeted guidance and support can empower farmers to integrate these tools effectively, fostering a more productive and sustainable agricultural sector.
Strategic policies play a critical role. Policies and programs which support education and implementation of Agri-tech and AI resources are critical. Farmers need access to practical training programs and resources to navigate technological solutions and learn how to use them effectively in their operations (Slingerland, 2024). Governments and investors must prioritize research and development, implement policies to incentivize technology adoption, and provide financial support to lower barriers for farmers (Hunter, 2024). This can help rejuvenate farming practices and attract young entrepreneurs back onto generational farms, thus transitioning them to producers.
At the 2024 Productivity Summit, Chief Economist Jean-Philippe Gervais emphasized there are three key drivers of productivity in agriculture: efficiency, scale, and innovation. Farmers are encouraged to find ways to achieve more with current resources. This means minimizing costs, improving marketing, and maximizing yields through strong management, advisory services, and data-driven decision-making. Farms of all sizes can boost productivity by expanding operations if they can leverage economies of scale and have better access to affordable capital. Innovation drives productivity through research and development, education, and market-ready solutions, while empowering farmers to adopt new technologies and expand their capabilities. In this burgeoning age of agriculture, Farmers, and soon to be producers, will wear many hats. Supportive policies can provide guidance as they navigate this new and complex role.
Jane O’Hara is a Master’s student at the University of Calgary’s School of Public Policy.
References
Betts, N. (2024, October 17). Canada’s Agricultural Sector: Growing for Tomorrow. Canada’s Productivity Summit, Calgary.
Canada, 2024. Overview of Canada’s agriculture and agri-food sector. Government of Canada. https://agriculture.canada.ca/en/sector/overview
Hebert, K. (2024, October 17). Canada’s Agricultural Sector: Growing for Tomorrow. Canada’s Productivity Summit, Calgary.
Hunter, M. (2024, October 17). Canada’s Agricultural Sector: Growing for Tomorrow. Canada’s Productivity Summit, Calgary.
Gervais, J-P. (2024, October 17). Canada’s Agricultural Sector: Growing for Tomorrow. Canada’s Productivity Summit, Calgary.
Slingerland, M. (2024, October 17). Canada’s Agricultural Sector: Growing for Tomorrow. Canada’s Productivity Summit, Calgary.