Farm Credit Canada's (FCC) latest outlook for farm assets and debt shows Manitoba's current debt-to-asset ratio is below the 15-year average.

The debt-to-asset ratio is a measure of solvency, indicating whether or not a farm has sufficient assets, such as land and buildings, to cover all liabilities.

FCC chief agricultural economist JP Gervais says the ratio's provincial decrease comes about from a rise in farmland values, as well as a reasonable increase in debt.

"So at the end of the day, I think if you're looking at the debt-to-asset ratio right now in Manitoba, because it's very reasonable, producers still a have the flexibility to make adjustments to their farming operations if they face unexpected challenges, or the opposite, if they see an opportunity out there, whether it's expanding or diversifying... they have the flexibility to do so," Gervais says.  

FCC's outlook forecasts increases Canadian farmland values to slow over the next two years, and in turn expects the rise in farm debt to slow, as well.