From the far north to the deep south, landowners across Ontario continue to invest in tile drainage despite ever-increasing acreage costs. They’re doing so partially because of high land values.
Why it matters: Farmers and other land investors install drainage tile to increase land values beyond existing per-acre purchase prices.
Jesse Tait, board member for Land Improvement Contractors of Ontario and co-owner of Grand Valley-based Tait Bros Contracting Ltd., says he and his colleagues continue to see strong demand for tile across their working area.
His company covers a wide swath of the province, including the Thunder Bay and Rainy River regions. In the south, Tait says high land costs and good commodity prices make it relatively easy to sell drainage tile.
In the North, good commodity returns and drainage specific cost-share programs available through the Northern Ontario Heritage Fund Corp. continue to drive investment.
Landowners who install tile through that program can obtain 50 per cent of tile drainage contractor costs to a maximum of $500 per acre, as well as 100 per cent of the project management/administration fees of the service provider. That is calculated as 10 per cent of the contractor costs to a maximum of $100 per acre.
Heritage Fund money is capped at either 50 per cent or $1 million toward eligible project costs.
“They’ve been going gangbusters. They did it back in the 1990s too, but [the government] took the program away for a while,” says Tait.
“They brought it back and landowners have really been taking advantage over the last seven years.”
More intensive installation
Northern growth in tile drainage investment has also involved shifts to denser spacing. In Tait’s experience, the old 40-foot (12 metre) guideline has been largely supplanted by a 30-foot spacing standard. Even closer spacing is often being used on higher value crops in efforts to improve yields.
“What’s interesting is some of the ground that was initially left alone, the back 10 that we didn’t need, they’re really trying to clear that stuff up. It’s just because of the price,” says Tait, referring to uncultivated land or parts of farms formerly left to scrub during times of lower land values.
Tile investments are not confined to farmers. In Tait’s experience, large investment bodies and companies also install tile after major land purchases. He believes the power of larger-scale capital is sometimes required to develop underutilized agricultural land.
Overall, the increased interest in land as an investment continues to act as an input driver.
“They’re not making any more ground…I think real estate is still the best investment there is and they’re realizing that,” he says. “Even people who are renting land are tiling.”
Conservation programs in the south
Southern parts of Ontario don’t have a Northern Ontario Heritage Fund equivalent to share tile drainage costs. But Colin Little, agricultural program coordinator with the Lower Thames Conservation Authority, says there are often other opportunities available to growers.
“In regards to regional cost-share funding for field systematic tile drainage projects, to my knowledge there are no programs that offer funds to offset the cost of this type of project,” says Little.
“That being said, some conservation authorities, and I believe the Ontario Soil and Crop Improvement Association, offer funds through certain programs to offset the cost of erosion control projects, which can include funding for the drainage infrastructure that is required for erosion control solutions.
“Examples of these projects would include water and sediment control basins, grassed waterways, saturated buffers, etc.”