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Published July 03, 2009, 12:00 AM

Area farm profits strong in 2008

ND farmers fare better than Minn. counterparts
Area farmers on average had their second straight strong year financially in 2008, according to statistics from a popular farm business management program.

By: Jon Knutson, INFORUM

Area farmers on average had their second straight strong year financially in 2008, according to statistics from a popular farm business management program.

“It wasn’t quite as profitable a year as 2007. But it was still better than most years,” said Andrew Swenson, North Dakota State University Extension Service farm management specialist.

Average farm income for the 532 North Dakota producers enrolled in the program totaled $180,746 in 2008, compared with $192,200 in 2007 and $54,800 in 2006.

Generally good crop prices and yields in 2008 and 2007 boosted profits.

For instance, the average price for spring wheat sold in North Dakota shot from $3.96 per bushel in 2006 to $5.28 in 2007 to $7.65 in 2008.

Average farm income for the 2,318 Minnesota farmers enrolled in the program totaled $138,898 in 2008, compared with $152,400 in 2007 and $91,971 in 2006.

Crops account for more of overall ag income in North Dakota than in Minnesota, where livestock and dairy play a larger role.

So North Dakota farmers, on average, have been helped more than their Minnesota counterparts by good crop prices and yields.

Despite the statewide averages, many area farmers struggled financially last year, said Ron Dvergsten, who’s involved with the farm business management program.

He’s regional dean of management education at Northland Community & Technical College in Thief River Falls, Minn.

Many areas suffered from too much or too little rain, he said.

“The moisture situation really varied,” Dvergsten said.

Poor meat and dairy prices also hurt many producers’ bottom line, he said.

Ted Reichmann, a Villard, Minn., cattleman and president of the Minnesota State Cattlemen’s Association, said the nationwide recession cut into demand for meat and hurt prices.

“It’s a reflection of the economy overall,” he said of lower beef prices. “But the cycle will turn eventually.”

North Dakota livestock producers were hurt, too.

The average net return per beef cow in the state last year was only $12.11, down from $98.11 in 2007 and $103.86 in 2006.

Rising expenses cut into all producers’ profits last year and cloud the outlook for future profitability.

For instance, North Dakota farmers spent $82,363 on fertilizer in 2008, up from $56,657 in 2007 and $36,543 in 2006.

Even so, Swenson said he’s optimistic farmers on average can make money this year, provided the weather cooperates.


Readers can reach Forum reporter Jonathan Knutson at (701) 241-5530

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