Resilience in Agriculture: How Farms Adapted During COVID-19 and Beyond

The Spring 2021 issue of Intelligent Farmer explores how Canadian farms navigated the challenges of COVID-19, from pivoting business models to understanding the pandemic’s impact on farmland values. Here’s a snapshot of key insights:

Click here to download the full Spring 2021 issue of Intelligent Farmer today

Herrle’s Country Farm Market: A Case Study in Adaptation

When COVID-19 disrupted in-person shopping, Herrle’s Farm Market swiftly implemented curbside pickup and online ordering.

Key takeaways:

• Family collaboration was crucial, with staff and relatives stepping in to manage hiring, packaging, and customer service.
• Weekly family meetings ensured agility, allowing them to address issues and share successes.
• The Garage, a throwback to their original roadside sales, became a hit, offering a safe, outdoor shopping experience.

COVID-19’s Impact on Southwestern Ontario Land Values

Despite the pandemic, farmland values in the region remained resilient, with modest growth in areas like Perth, Wellington, and Waterloo. Factors included:

• Urban migration: Remote work drove demand for rural homes, boosting land prices.
• Low interest rates: Kept borrowing affordable, supporting land investments.
• Strong agricultural demand: Minimally improved farms and vacant land saw premiums, especially near livestock operations.

Tax Strategies for Farm Vehicles

Properly classifying vehicles as Class 10 (no depreciable cap) vs. Class 10.1 ($30,000 cap) can significantly impact write-offs. Key rules:

• Class 10 eligibility requires the vehicle to be used >50% for farm business (e.g., transporting goods/equipment).
• Luxury or extended-cab trucks may struggle to meet the 90% business-use threshold for Class 10.
• Logbooks are essential to document business vs. personal use and avoid standby charges.

Financial Planning: Record-Keeping & Tax Tips

• Accurate records are vital for informed decisions and lender approvals. Track costs per acre/animal and monitor cash flow.
• Deferring taxes on inventory can backfire; consider paying lower rates annually to avoid higher brackets later.
• Capital gains exemptions (up to $1 million for qualified farm property) should be utilized strategically.

Don’t miss the full issue.

RBC Dominion Securities Inc. | Lorkovic DeKoning Wealth Management | www.lorkovicwealth.com