Monette Farms near Hafford, Sask., on May 9. The company filed for creditor protection on April 20.Liam Richards
Saskatchewan-born multi-generational farmer Darrel Monette spent a decade building a 500,000-acre farming empire spanning his home province, Manitoba, Alberta, British Columbia and the states of Arizona, Montana and Colorado.
His conglomerate of 18 companies harvests canola, wheat, durum, carrots, squash, broccoli, pumpkins, wine grapes and a lot more besides. It breeds and raises black and red Angus cattle for slaughter and has three seed facilities. It employs 600 people during peak season and by 2025 had total assets amounting to $1.2-billion. It is one of the biggest farms in Canada, per farmed acres.
Mr. Monette funded the expansion of his empire through debt. Starting in 2014, he borrowed against farmland on repeat, and in 2018 secured $908-million from a collection of lenders, including a $30-million loan from Crown corporation Farm Credit Canada, according to legal filings.
“Build your shop bigger than you’ve ever built, because you’ll grow into it,” Mr. Monette told hosts of RealAgriculture’s The Truth About Ag podcast in October, 2024.
But as the snow thawed across the Canadian Prairies and planting season approached this year, Monette Farms didn’t have the liquidity to cover the $40-million cost of seeding. Its operating revenue had not covered interest payments since 2024, and it could not pay back debts that matured April 15.
Monette Farms filed for creditor protection on April 20.
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As the Canadian agriculture industry waits to see how the saga will unfold in the coming months, there is debate over what it says about the future and viability of the sector.
Critics say the megafarm’s situation is a consequence of growing too big, too fast. But others warn the entire industry is facing a reset, with crop prices down, interest rates rising and production costs increasing.
Mr. Monette did not respond to The Globe and Mail’s request for an interview.
On May 1, the Alberta Court of King’s Bench approved $90-million, debtor-in-possession financing from a Scotiabank-led syndicate for Monette Farms to purchase crop inputs and fertilizer. Creditor protection has been extended until June 19.
For Mr. Monette’s operation to have a chance to recover, this year’s narrow window for seeding could not be missed, and should not be delayed, he argued in an affidavit filed in Calgary. Delays would affect the harvest. Should the land be left unplanted and unmanaged, weeds, invasive species, and soil erosion would depreciate its value, according to the filing.
This was Mr. Monette’s justification for additional financing. Without productive land, he didn’t have a chance of paying off the loans that were already due.
As of April, Monette Farms owned approximately 274,000 acres of land.Liam Richards
Mr. Monette’s empire started in 2004 with a single quarter section that he purchased for $40,000, he told the RealAgriculture podcast. In 2013, Mr. Monette inherited his family’s 25,000-acre farm, and that’s when his expansion efforts began in earnest. He leveraged the property to buy land, seed facilities, ranches, feedlots and even wineries across Canada and the U.S.
As of April, Monette Farms owned approximately 274,000 acres of land across Western Canada and the U.S., and leased 218,000 acres. The largest share of its production – 68 per cent – is located in Saskatchewan.
As a result of debt-driven expansion, the company’s revenue grew from $45-million in 2017 to $347-million by 2024, according to the affidavit. This was possible because of growing property valuations and low interest rates. Mr. Monette paid around 3-per-cent interest on his loans across this period, the affidavit says.
Monette Farms was not the only operation to take advantage of low interest rates and good crop years, said Ted Cawkwell, a Saskatchewan farmland realtor.
“We’ve had a lot of farms across Saskatchewan grow more rapidly than we’ve seen in the past because the conditions were favourable.”
But what made this megafarm unique was its scale and diversity, said André Magnan, a professor of agri-food systems at the University of Regina whose research focuses on farmland ownership. It is rare that a private operation would operate in two sub-sectors such as grain and produce, he said.
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Robert Andjelic, who holds Canada’s largest portfolio of farmland, suggested Mr. Monette’s operation fell victim to bad luck.
“A whole bunch of circumstances came together that – in my opinion – are going to be corrected this year,” said Mr. Andjelic, who is a friend and landlord to Mr. Monette. (Mr. Andjelic does not farm the land he owns. He buys land and leases it back to the farmer.)
Successive droughts have taken hold of Southwest Saskatchewan, starting in 2009, according to provincial government data. Last year saw the driest September in Swift Current in 140 years. Monette Farms has substantial acreage concentrated in that region.
Over the same time span, property valuations flattened as a result of lower farm productivity, and interest rates climbed, said Mr. Cawkwell.
By 2024, Mr. Monette’s affidavit says his megafarm began struggling to pay the interest it owed.
Last year, a world-record harvest caused a plunge in prices for grain, which accounts for more than half of the operation’s revenues.
Chinese tariffs on imports of Canadian canola products – which started in March, 2025, and eased in March of this year – added further strain, as a months-long battle between Beijing and Washington, D.C., over soybeans depressed the oilseed market.
In 2025, Monette Farms had projected earnings before interest, taxes, depreciation and amortization of $72-million, according to the affidavit. The actual amount was approximately $31-million.
All the while, geopolitical headwinds were worsening inflation.
“There’s been a lot of wealth sucked out of the grain industry in the last few years,” said Brenda Tjaden, founder of the Prairie Routes agricultural consultancy. She pointed to recent hikes on rail shipping rates and fertilizer prices, which have been volatile since one of the world’s largest exporters, Russia, launched its full-scale invasion of Ukraine in 2022.
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Fertilizer costs are only expected to rise. Approximately one-third of this critical crop input passes through the Strait of Hormuz, which has been effectively shut down since the Iran war began in February.
Prices for the world’s most commonly used fertilizer – urea – have climbed by 50 per cent since the war began.
Canadian farmers were largely insulated from these effects this year, because most fertilizer was purchased and shipped before the war broke out.
But there is pain ahead. Even if the Strait of Hormuz fully opened tomorrow, urea prices for North American farmers would stay around 35 per cent above pre-war levels, according to a report from North Dakota State University.
This mix of factors has changed the game for large-scale farming operations, suggested Mr. Cawkwell, the farmland realtor. “The whole premise that they were building these farms on, it just doesn’t work as well in today’s new environment.”
The squeeze is being felt across the board, according to Mr. Magnan. “Family farms, or farms of any size, are dealing with those same types of pressures,” the agri-food professor said.
But he still sees Monette Farms as an outlier – and a cautionary tale.
“The larger underlying issues was perhaps that Monette was too ambitious, that it grew too quickly, and that lenders were perhaps too willing to fund this very rapid and I would say risky expansion.”