Tuesday, 25 December 2012

Idaho agriculture will set a revenue record in 2012


BOISE -- Idaho agriculture's record for total farm gate receipts in a calendar year will be broken in 2012, a scenario that seemed very unlikely to economists several months ago.

With grain and forage prices at high levels and with some improvement in milk prices during the latter part of the year, "It's pretty evident we will set a new record for total revenue," University of Idaho agricultural economist Paul Patterson said.

The actual numbers, which are contained in UI's annual "Financial Condition of Idaho Agriculture" report, won't be released until university officials present them to lawmakers in early January at the onset of the 2013 Idaho Legislature.

But Patterson said cash receipts for all Idaho farm commodities combined will be up about 5 percent this year, which means last year's record of $7.4 billion will be exceeded by almost $400 million.

Total net farm income will also be up about 5 percent, which means last year's record of $2.64 billion for that category will fall by more than $150 million.

The report will show no change in ranking for Idaho's top seven ag commodities: dairy, cattle, potatoes, wheat, hay, sugar beets, barley, dry beans and onions.

It will also show that many of the state's top farm commodities set all-time records for cash receipts in a calendar year.

That includes dairy, the state's top farm commodity when it comes to farm gate receipts.

But setting a record for total revenue is small consolation for the state's dairy producers, who have had to deal with record expenses as well.

The numbers "mask the serious financing situation that exists for a large number of dairy producers in the state," Patterson said. "These high feed prices are really killing them. There are still some very serious issues (with) the dairy industry."

High feed prices are benefiting a lot of farmers, "but the dairymen and anybody feeding cattle is struggling," said Kuna dairyman Jack Davis. "If you're not profitable, (the record is) no consolation."

Last year's record of $7.4 billion was far above the former record of $6.22 billion set in 2008 and heading into this year's growing season, ag economists in the state said that while 2012 would be a good year for Idaho agriculture, the record was safe.

But Patterson said that all changed earlier this summer when corn prices began to soar, affecting other commodities as well. As an example of how the situation changed, he points to a USDA report in May that forecast an average U.S. corn price of $4.60 in 2012.

The forecast in the December report was $7.40, and the forecast for wheat similarly rose from $6.50 to $8.

UI ag economists are estimating total farm expenses in Idaho increased 8 percent in 2012.

Wheat and barley prices are up significantly, "but nitrogen and fuel are up, too," said Driggs grain farmer Mark Trupp. "Almost all the grains are up, but expenses are up, too."
Original Article Here

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