Red ink on beets, corn for RRVFARGO, N.D. — Farmers outside the Red River Valley in North Dakota did better financially in 2013 than farmers inside the valley, according to the annual North Dakota Farm Management Education Report. That happens only about two years out of 10.
By: Mikkel Pates, Agweek
FARGO, N.D. — Farmers outside the Red River Valley in North Dakota did better financially in 2013 than farmers inside the valley, according to the annual North Dakota Farm Management Education Report. That happens only about two years out of 10.
The report chronicles how much the net income declined off the meteoric 2012 levels.
“The big story was how income crashed in the valley,” says Andy Swenson, a North Dakota State University Extension Service agricultural economist who analyzes the data. The 2013 nosedive came off the 2012 season, which was “the best year we ever have seen, or expect to see in agriculture again,” Swenson says.
Results were especially impressive because of losses in corn and sugar beets, which are more prevalent in the valley.
Red River Valley farmers lost an average of $62 an acre on cash-rented corn ground in 2013, based on 225 farmers in both North Dakota and Minnesota. In the 2012 crop year, the same farmers would have netted $331 an acre in profit on corn.
Black to red ink
Sugar beets went from black to red ink on the year. Results are reported in four tables, representing different ownership situations:
• Cash renting land and joint-venturing the cooperative stock that gives farmers the right and obligation to deliver beets: 2012 — $316 per acre net profit; 2013 — $358 per acre net loss.
• Cash rent land and owning stock: 2012 — $612 per acre profit; 2013 — $198 per acre loss.
• Owning land and joint venturing stock: 2012 — $293 per acre profit; 2013 — $356 per acre loss.
• Owning land and owning stock: 2012 — $684 per acre profit; 2013 — $144 per acre loss.
Some crops made money in the Red River Valley in 2013, the report says.
Red River Valley soybeans on cash-rented ground in 2012 made $213 per acre in profit, but declined to $79 per acre profit in 2013. Soybeans on owned ground went from $264 an acre profit in 2012 to a $139 an acre profit in 2013, according to the report.
Spring wheat on cash-rented land in the valley went from $135 an acre profit in 2012 to $30 an acre profit in 2013. On owned land, the wheat went from $169 an acre profit in 2012 to $92 per acre profit in 2013.
Swenson says there were reduced profit expectations in 2014. Profit projections were lower relative to soybeans, but farmers who have invested in corn-related equipment — cropping, storage and drying — were apt to stick with the crop.
Outside the Red River Valley, net income was a “fair amount higher” than in the Red River Valley. A wide variety of crops — durum, spring wheat, barley, sunflowers, soybeans, dry beans and canola — all showed positive results, but not as positive as 2012.
“Historically, it would have been considered a good year, but you were coming off of such a strong year for all of the crops except corn,” Swenson says.
Farm profit from livestock in 2013 was strong, which mitigated some of the drop in crop income outside the valley, but not in the valley where very little livestock is grown, Swenson says.