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Growing the PEI Agricultural Industry
The agricultural and agri-food industry is a cornerstone of Prince Edward Island’s (PEI) economy, deeply rooted in the province’s history, culture, and economic framework. Agriculture, alongside agri-food processing, is not merely an economic activity but a way of life for many Islanders and a vital contributor to the province’s identity. With its rich soils and favorable growing conditions, PEI has long been celebrated for its agricultural heritage (Gupta, 1991; MacFadyen, 2016), particularly its renowned potato production, which has established the province as a significant player in national and international markets (Government of PEI, 2020a).
PEI Farms at a Glance
According to the 2021 Census of Agriculture, PEI is home to 1,195 farms, covering a total area of 504,674 acres. While this represents just 0.3% of Canada’s total farm area, the province’s agricultural output is notably significant given its size. The diversity of PEI’s agricultural sector spans a wide range of activities, from grain and oilseed farming to fruit and vegetable production, as well as livestock farming. This variety not only contributes to the province’s economic resilience but also ensures that PEI remains a key player in national agricultural production.
Beyond its economic importance, agriculture is an integral part of PEI’s cultural fabric and rural identity. Farming has shaped the province’s history, traditions, and way of life for generations, with rural communities deeply reliant on agricultural activities. Agriculture’s influence extends beyond the fields, fostering a sense of pride and connection to the land. The continued vitality of this sector supports not only the economy but also the preservation of PEI’s rich cultural heritage and rural traditions.
Economic Growth Strategies
To maximize the economic potential of PEI’s agricultural and agri-food sector, a variety of high-level strategies are necessary. These strategies will help bolster the sector’s contributions to GDP, employment, and international trade.
Expand Value-Added Processing
Increasing local processing capacity, particularly in areas like potato, dairy, and meat products, allows for higher value products to be marketed, increasing PEI’s economic footprint. This can enhance export potential and create more local jobs in the processing sector.
Strengthen Export Market Access
Fostering new trade relationships and enhancing market access in emerging international markets are crucial for continued growth. By reducing trade barriers and building relationships with non-traditional markets, PEI’s agricultural sector can diversify its exports and reduce dependence on key trading partners like the U.S.
Invest in Agricultural Technology and Infrastructure
Agricultural technology improvements can increase farm productivity and sustainability. Investments in infrastructure, such as transportation networks and cold storage facilities, will ensure PEI’s agricultural products reach markets more efficiently, improving the industry’s competitiveness.
Support for Agricultural Innovation and Research
Continued investment in research and innovation within PEI’s agricultural sector will help develop new techniques, technologies, and products. This includes supporting sustainable practices, improving yields, and addressing challenges like climate change.
Improve Farm-to-Market Supply Chains
Optimizing the logistics and distribution networks between farms and markets ensures products get to consumers efficiently and in top condition. Investing in these supply chains supports the entire sector, from farmers to processors to retailers.
Enhance Policy and Regulatory Support
Effective policies and regulations that support the agricultural sector are necessary to boost productivity and economic growth. This includes ensuring policies that encourage investment, sustainability, and growth while protecting environmental and social interests.
Farm-Level Economic Actions
At the farm level, a range of actions can be taken to increase economic output, boost revenue, and ensure long-term sustainability. These practices focus on improving the efficiency and profitability of individual farm operations.
Diversify Agricultural Production
Diversification at the farm level not only spreads risk but also opens up new revenue streams. Farmers could explore growing high-demand crops, raising alternative livestock, or engaging in niche markets such as organic or specialty crops.
Adopt Sustainable Farming Practices
Integrating sustainable farming practices—such as crop rotation, reduced pesticide use, and sustainable water management—can help increase long-term productivity, reduce costs, and improve environmental impact. These practices often align with market demand for sustainably produced goods.
Engage in Direct Marketing and Value-Added Activities
Farmers can increase their profits by selling directly to consumers or engaging in value-added activities, such as producing artisanal products, packaged goods, or processed foods. This reduces reliance on third-party distributors and captures a larger share of the market value.
Improve Farm Management and Financial Practices
Efficient farm management, including better financial planning, technology adoption, and cost control, can enhance a farm’s economic viability. Utilizing farm management software or consulting services can help farmers better understand their financial position and plan for growth.
Invest in Diversified Revenue Streams
Adding non-traditional revenue sources, such as agritourism, farm events, or renewable energy initiatives (e.g., wind, solar), can increase farm income while diversifying economic risk. This not only supports farm operations but also increases the farm’s community engagement.
Focus on Product Quality and Branding
By focusing on the quality of products and creating a unique farm brand, farmers can position themselves in premium markets. This could include developing signature products (e.g., PEI potatoes) or emphasizing the sustainability or local aspect of farm goods, which are highly valued by consumers.
Supporting Data and Infographics
Effective economic planning relies on robust data and analysis. This section presents key figures and insights that shape the economic strategy for PEI’s agricultural sector. From economic impact data to export trends and industry projections, these visuals provide a data-driven foundation to guide decisions and track the sector’s growth toward future goals.
Economic Impact of the Agricultural and Agri-Food Industry
- Figure 4: PEI’s Agricultural and Agri-Food Industry Total Economic Impact by Category (Additional/Alternate Representation)
- Figure 12: PEI’s Agricultural and Agri-Food Industry: Total Economic Impact by Category, 2021
- Figure 13: PEI’s Agricultural and Agri-Food Industry Contributions to Provincial GDP, 2021
- Table 2: Economic Impact of PEI’s Agricultural and Agri-Food Industry on PEI’s Economy, 2021
- Table 3: Multipliers of PEI’s Agricultural and Agri-Food Industry, 2021
- Table 5: Detailed Economic Impact of PEI’s Agricultural and Agri-Food Industry on PEI’s Economy, 2021
- Table 6: Economic Impact of PEI’s Agricultural and Agri-Food Industry on RoC’s Economy, 2021
- Table 7: Economic Impact of PEI’s Agricultural and Agri-Food Industry on Canada’s Economy, 2021
Agricultural and Agri-Food Exports
- Figure 7: Share of Agricultural and Agri-Food Exports in Total Exports by Province, 2024
- Figure 8: Top Ten Agricultural and Agri-Food Export Markets for PEI, 2024
- Figure 9: Agricultural and Agri-Food Exports Per Capita by Provinces, 2024
- Figure 10: Potato International Exports by Province, 2024
- Figure 11: Economic Backward and Forward Linkages
- Figure 14: PEI’s Agricultural and Agri-Food Exports in Nominal and Real Values, 1990–2024
- Figure 15: Real Annual Growth Rate of PEI’s Exports, 2015–2024
- Figure 16: PEI’s Agricultural and Agri-Food Exports Forecast, 2010–2030
Industry Output and Growth Projections
- Figure 5: Distribution of Licensed Dairy Establishments by Province, 2024
- Figure 6: Distribution of Federally Inspected Cattle Slaughter Plants by Province, 2024
- Figure 17: PEI’s Agricultural and Agri-Food Industry Output in Nominal and Real Values, 2010–2021
- Figure 18: PEI’s Agricultural and Agri-Food Industry Growth Forecast, 2015–2030
Agricultural Industry Classification
PEI’s agricultural and agri-food sector is a key contributor to the province’s GDP, employment, and exports. The industry, particularly in potatoes, dairy, and livestock, is central to both provincial and national economies. To sustain growth, strategic investments in value-added processing, market expansion, and technology are essential. Strengthening infrastructure and promoting sustainable practices will help PEI maintain its competitive advantage.
Looking ahead, the sector shows strong growth potential, with increasing exports and output driven by new markets and consumer demand. To unlock this potential, sector-level and farm-level actions must align with long-term goals. By focusing on diversification, sustainability, and innovation, PEI’s agricultural sector can continue to drive prosperity for the province and its communities.
Download the PEI Agricultural Economic Impact Plan
Keep reading
GHG Reductions
Prince Edward Island’s agriculture sector is working to cut emissions 35-40% below 2015 levels by 2040. Farmers are adopting best management practices (BMPs) to reduce their environmental impact while staying productive. This strategy focuses on soil health, nutrient efficiency, and carbon sequestration to ensure a resilient and sustainable future.
Building Resilience
Prince Edward Island’s agriculture sector leads in innovation and adaptation, confronting climate change and economic pressures. This sectoral adaptation plan unites farmers, researchers, and stakeholders to secure farming’s future through actionable strategies, collaboration, and a shared vision for sustainability.
