The impact of agricultural credit use on the financial progress of the farm firm in Western Manitoba, 1961-69

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Somuyiwa, Moses Olufemi
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This was a study on the impact of agricultural credit use on the financial progess of the farm firm. The analysis was made on the data obtained from the business record of twenty-seven charter members of the Western Manitoba Farm Business Association. These farms had kept fairly accurate records of their farm business for the years 1961-69 consecutively. The objective of the study was to examine and evaluate some of the factors influencing the financial progress of the farm firms and to suggest guidelines for better credit use by farmers and for policy makers in their efforts to reduce the rate of decline in the number of farm firms in Western Manitoba... In general, the analysis indicated that there is a high correlation between farm earnings and size of the farm business so that managerial ability of the operator as expressed in the efficient allocation of resources between farm enterprises become crucial to the growth process. While it is apparent that adequate non-equity capital should be readily available in sufficient amounts to farm operators, it is also obvious that avialability of adequate credit alone may not ensure the success of farm enterprises. The rate of decline in the number of family farms in Western Manitoba may be reduced much more effectively by programmes designed to eliminate credit rationing barriers at both institutional and individual farm levels. More importantly, an educational programme aimed specifically at improving the managerial ability of farm operators should be accorded some priority in farm development programmes.