'Always emotional;' Fewer small auctioneers as big Sask. farms become the norm

·6 min read

Kelly Schneider has auctioned off Saskatchewan farms for almost 40 years.

He's past of the third generation of his family to take up the profession; as soon as he graduated with a Bachelor of Education in 1982, his grandma offered to pay for his training as an auctioneer so he could continue the family tradition.

Ever since, he's been involved in selling farms in the Spiritwood area, roughly 180 kilometres north of Saskatoon.

He treasures the time he spends before dozens of neighbours who crowd onto yards, sharing coffee and pie as they bid.

Every year, the farms up for bid slowly become fewer and larger as farm auctioneering also grows into bigger business.

Selling a farm is “always emotional,” Schneider said. That's because there tends to be one of three reasons for a sale: a bankruptcy, a retirement without succession, or a death. Each of these sales represents a small part of the centralization of agriculture — a driving force behind urbanization in Saskatchewan.

Records show that the number of Saskatchewan farms peaked in 1941 at 138,713. Within a single lifetime, by 2016, those numbers fell roughly 82 per cent, to 24,523.

In 2011, the last time data was collected, the average farm size in the province was 1,668 acres, compared to 432 in 1941 — although University of Saskatchewan Professor Emeritus Rose Olfert notes the 2011 figure could skew small because it includes small hobby farms.

Olfert has dedicated her life to studying agricultural economics and says centralization of agriculture is just a fact of life. Since engines replaced horses, advances in machinery have made it easier to manage large swaths of land. The bigger the farms, the more profitable they can be. Higher returns allow farmers to invest in land and equipment. The purchases make their properties more profitable, allowing for more reinvestment.

When the economy booms, it can speed up the process because more accessible credit allows farmers to borrow more to buy more land. And their neighbours are more open to sell when their land fetches a higher price.

Over the years, advances in equipment have meant labour requirements to maintain farms have declined.

“The farmer, like any business person would, has successfully replaced labour with capital,” Olfert says.

Michael Gertler, a professor of rural sociology at the University of Saskatchewan, adds that large-scale changes in trade and government policy have tended to favour larger operations.

He pointed to the dissolution of the Canadian Wheat Board — a sole purchaser and marketer of wheat until 2012 — as an example. When the board was no longer there to absorb losses or pass profits on to smaller farmers, that hurt small operations.

This political side of farm centralization has raised concerns from some observers.

A 2015 article published in Canadian Food Studies that looked at farm ownership in three Saskatchewan rural municipalities found that the largest four owners in each "more than doubled, or nearly tripled" their portion of land between 1994 and 2014.

The study found investment funds, investors, pension plans, and farmer/investor hybrids were the main drivers of concentration.

Earlier this year, the Canadian Centre for Policy Alternatives, a left-leaning think tank, released a report warning of growing inequality in the Prairies, pointing out that farms of 10,000 acres or larger, which account for two per cent of operators, received 15 per cent of gross income and revenue, averaging out to about $820,000 per operator.

Debt is also helping to fuel the transition from family farms to big businesses, says JoAnne Jaffe, a rural sociology professor at the University of Regina.

Statistics Canada reported that total Saskatchewan farm debts were as high as about $17 billion in 2019, compared to roughly $8 billion in 2009. That outstripped total cash receipts over the same period, which rose to $14 billion from $9 billion.

Jaffe said larger operators are also able to exercise more power in the marketplace, giving them competitive advantages like preferential conditions from farm-adjacent businesses like equipment suppliers.

"Because you're big, people want to keep you as a customer."

When Kristjan Hebert moved home to his family grain farm near Moosomin in 2004, it was roughly 2,000 acres. He expects Hebert Grain Ventures will grow to 28,000 acres by next year.

“We’re addicted to the game of farming,” he says.

At 38 years old, Herbert is a rarity among farmers. Overall, the sector is greying; farmers older than 55 accounted for more than 55.9 per cent of operators in 2016.

From 1991 to 2016, there’s been a 68 per cent decline in young Saskatchewan farmers, defined as those under the age of 35; there were 24,850 young farmers in 2016, down from 77,910 in 1991.

While the centralization of farming can pose challenges for the rural businesses, schools and services that rely on a critical mass to operate, Hebert argues the growth of his operation is not contributing to the hollowing out of rural communities. He employs 10 full-time people and five permanent part-time workers.

While Hebert Grain Ventures is incorporated, it has four local board members: himself, his wife, his mother and his father. He said concerns he’s heard regarding farm size tend to be about large corporations with few local ties taking over farmland.

And he argues the large size of his operation helps him advocate for Saskatchewan farmers; he sits on advisory boards for government and sector heavyweights, including John Deere. When it comes to large-scale decisions, “we need to have some size to matter,” he says.

Farms like Hebert's, that are larger than 20,000 acres, account for 38 per cent of farmland in Saskatchewan. There are 2,433 operators running such large farms.

COVID-19 forcing more change

For auctioneers like Kelly Schneider, the rapid expansion of farms like Hebert's and the increased investment in equipment are just part of the job. He witnessed it for years, and intends to keep doing so for another decade or so, even if things look different.

Since COVID-19, online auctioneering has taken off and Schneider says some larger operators are more inclined to shop online for their equipment rather than visit a community farm auction.

He doesn’t blame his fellow auctioneers for choosing to sell to a larger company. In many ways, it's the same as a farmer selling their land to a growing neighbour. But he has no intentions to do the same.

"There’s still people who drive big, heavy horses because that’s been bred into them and that’s what they love to do," he says. That's how he sees himself: Continuing live auctioneering because it's in his blood.

“I still love the old way of doing things and I hope there’s still going to be a place out there somewhere," he says. "And I think there will be.”

Nick Pearce, Local Journalism Initiative Reporter, The StarPhoenix