The Economics of Production and Marketing of Greenhouse Crops in Alberta

 
 
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 Introduction
The origin of the Alberta Greenhouse Crops Industry goes back over a hundred years. It was in 1905 when Dutch and German settlers began plant production under protection cultivation. Since 1970, Alberta Agriculture and Rural Development (ARD) have committed material resources to the development and growth of this industry in Alberta. Full text of the 48 page report is available in pdf format.

Alberta’s greenhouse industry is ranked fourth in the country. Preliminary estimates of total greenhouse area by Statistic Canada in 2012 shows that Ontario continues to lead the greenhouse industry with 13 million square metres (1,330 hectares), followed by British Columbia at 5.3 million square metres (531 hectares) and Quebec at 2.6 million square metres (262 hectares). In percentage terms, Ontario accounts for 56 percent of all greenhouse area in Canada, with British Columbia at 23 percent and Quebec at 11 percent. Alberta accounts for about five (5) percent of the greenhouse area in Canada and the other provinces combined accounted for the remaining five (5) percent of greenhouse area.

Presently, the size of Alberta’s greenhouse industry, under both glass and plastic, is approximately 1.3 million square metres (127.5 hectares or 315 acres). Vegetables make up about 135 acres of the total acreage; bedding plants and ornamentals, 139 acres and tree seedlings constitute approximately 41 acres. Out of the 135 acres for vegetables, 76 acres are under cucumbers, 37 acres for tomatoes, 16 acres for peppers and the remaining 6 acres for lettuce and other crops.

In 2012, there are 328 greenhouse operations in Alberta and the industry employed approximately 1,600 full-time and 3,200 part-time workers. A recent survey of the industry across the province showed that approximately 99 percent of the greenhouse area in Alberta is under commercial production, with the balance confined to institutions such as universities, research stations and colleges. Most of Alberta’s greenhouse operations are highly diversified and are equipped with the most modern equipment to achieve production efficiencies.

Major greenhouse crops grown include vegetables, bedding plants, potted flowers and ornamentals, cut flowers, herbs, perennials and tree seedlings. Tree seedlings are produced under contract for the forestry industry.

During the last decade, the greenhouse industry in Alberta grew rapidly. This growth was prompted by consumer demand for fresh and quality produce. Lower taxes and input costs also contributed to this growth however, recent rapid increases of natural gas and electricity prices have somewhat dampened further expansion prospects for this industry in the short run.

Due to the several adjustments the greenhouse industry in Alberta has gone through, the need to estimate costs and returns data based on current conditions is important to contribute to informed decision making. This report is based on actual costs and returns from thirty six (36) greenhouse operators across the province1, and provides more current data on costs and returns for major greenhouse crops.

Objectives of the Study
The major objectives of the study are as follows:
  1. To describe the structure of the greenhouse industry in Alberta.
  2. To report estimated greenhouse production costs and returns by major crops.
  3. To identify the main factors influencing production and marketing of greenhouse crops in Alberta.
  4. To identify major problems experienced by greenhouse producers in Alberta.

The Study Sample
A questionnaire specifically designed for greenhouse operations was used to obtain the required information from a selected sample of greenhouse operators across Alberta. Thirty seven (37) greenhouse operators were interviewed to obtain production costs and returns information on bedding plants/ornamentals, cut flowers, tree seedlings, cucumbers, peppers, and tomatoes for the 2011 crop.

Method of Analysis
The raw data obtained was reviewed for information gaps before entering into the computer for analysis. Individual analyses and group averages were developed using the Paradox program. Individual analyses were mailed to study participants for their review and feedback before finalizing the group averages for this report.

To preserve confidentiality, group averages were developed for greenhouse crops with three or more participants. For crops with less than three participants reporting (i.e. cut flowers and tree seedlings), some of the data collected for the 2008 crop year were updated to 2011 using farm input price indices (FIPIs) and prices received for various crops and then blended with the 2011 information collected to develop group averages.

Readers are advised to note that due to the small sample size, only aggregate production costs and returns information for the whole province has been presented in this report. The costs and returns information were not broken down into the Medicine Hat/Redcliff and North-Central groups as reported in previous versions of the report.

1 In total, thirty seven (37) greenhouse operators were surveyed.

Source: Agdex 821-59. August 2013.

 
 
 
 
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This information published to the web on June 18, 2002.
Last Reviewed/Revised on September 1, 2017.