Farmers Enter 2025 With Rising Uncertainty and Concern Over U.S. Tariffs
Farmer sentiment has turned notably more negative heading into 2025, with the proposed 25% U.S. tariffs on Canadian exports emerging as the most pressing concern. The January 2025 RealAgristudies Insights Panel indicates that 86% of farmers believe these tariffs will negatively or possibly impact their operations. Additionally, 76% of respondents support some form of retaliatory action by the Canadian government, ranging from matching tariffs to broader sanctions, while 24% prefer diplomatic solutions.
The fear of increased trade restrictions is driving a broader sense of economic pessimism, with 68% of farmers perceiving 2025 as riskier than 2024—a significant increase from previous surveys. Much of this heightened concern stems from uncertainty over U.S. trade policy and its potential financial fallout.
Farmers Feel Worse Off Financially and Are Pulling Back on Investments
Compared to January 2024, nearly half (46%) of farmers report being financially worse off today, while only 18% feel better off. The majority of surveyed farmers plan to reduce investments in equipment and new purchases throughout 2025, signaling a pullback in capital spending due to tight margins and concerns over future profitability.
Land Values Absent from Discussion, but Risk and Costs Remain Key Issues
Unlike previous surveys, land values were not a major focus in the latest farmer sentiment analysis. Instead, the dominant themes were commodity price volatility, rising input costs (fuel, fertilizer, equipment), and increased financial risk. Although land prices have historically trended upward, current uncertainty suggests a more cautious approach to expansion and investment.
A More Cautious Outlook for 2025
With commodity prices under pressure, input costs climbing, and U.S. trade relations uncertain, Canadian farmers are bracing for a more challenging year. While some optimism existed in late 2024 regarding lower borrowing costs, it appears that ongoing profitability concerns and policy instability are overriding those expectations. The tariff situation remains the key issue to watch, as any formal implementation or policy shifts from the U.S. could significantly reshape farm financial planning in 2025.
Sources & Further Reading:
RealAgriculture. (2025, February). Farmer Sentiment Slips into the Negative in the Face of Low Margins, Tariff Uncertainty. Read more.
RealAgriculture. (2025, February). RealAgristudies Canadian Farmer Sentiment Index Jan 2025. Watch on YouTube.
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DISCLAIMER: The predictions of farmland values for the upcoming year presented in this newsletter are solely the opinions of S.W. Irvine & Associates. These opinions are for general information purposes only and should be regarded as such. They are based on our analysis of current market trends and historical data, but they do not constitute guarantees of future performance. S.W. Irvine & Associates, is not legally bound by these opinions, and they should not be used as the sole basis for any financial decisions.
For individuals or entities with a more vested interest in the precise value of specific properties, S.W. Irvine & Associates offers professional appraisal services. Our team of experts can provide a detailed, property-specific analysis to help you make informed decisions. For more information please contact us at farms@swiappraisals.com | 519-763-5956 or submit your appraisal request here.
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