Farmers See Record Profits 29 Mar 12

Minnesota farmers overcame erratic weather and volatile markets to post record profits last year.

The Pioneer Press reports the survey of nearly 2,400 Minnesota farms found median net farm income reached a record $123,000 last year, up 1 percent.

The University of Minnesota and the Minnesota State Colleges and Universities system compiled the numbers.

“Agriculture continues to be a bright spot for Greater Minnesota and the state’s economy,” said Richard Joerger, MnSCU’s director for agriculture and business.

The report said higher grain prices and more profitable livestock operations helped improve the 2011 numbers. But stressful weather and lower crop yields limited the gains.

Minnesota’s 2011 growing season had a late and soggy start, an early frost and a drought that lasted all autumn. While those factors helped push grain prices to record highs, they also cut into yields.

“Even with record-high crop prices, crop farms saw a slight decrease in profitability,” said Dale Nordquist, an extension economist with the University of Minnesota’s Center for Farm Financial Management. “Crop farms were still very profitable, but the lack of rain at the end of the growing season along with increasing production costs kept them from attaining higher profits.”

The report found most Minnesota livestock farms showed improvement in 2011.

Dairy farmers reported median net farm income of $91,000, up from $68,000 the year before. The median is the midpoint, where half the farm incomes in the survey were higher and half were lower.

Hog and beef producers also reported gains, although higher feed costs had an effect. Many Minnesota producers grow their own feed, which helped offset the price jump.