Idaho set to break record for total farm revenue
By Sean Ellis
Idaho Farm Bureau Federation
POCATELLO – Barring an unforeseen catastrophe, Idaho will almost certainly set a record for total farm-gate receipts this year.
Whether farmers actually increase their bottom line this year, however, is uncertain given that farm input costs are soaring.
“We’re going to break an all-time record for cash receipts this year,” said University of Idaho Agricultural Economist Garth Taylor.
Farm-gate receipts are the revenue that farmers and ranchers receive for their commodities.
Taylor is one of the authors of U of I’s annual Financial Condition of Idaho Agriculture report, which estimates total farm-gate receipts and total net farm income in Idaho. One of the report’s co-authors, economist Ben Eborn, agrees that it appears inevitable the state’s record for farm-gate receipts will be broken this year.
“We are going to set a record this year for cash receipts, for sure,” he said.
The reason is simple: the price for virtually every agricultural commodity is up this year. Idaho farmers also expect good yields this year.
Usually, the prices for a handful of agricultural commodities can be expected to be up significantly in a given year, said Rick Brune, who farms in Kimberly.
“This year, it seems like all of them are up,” he added.
So, put good or near-record yields for some commodities and high commodity prices together and … “The farm-gate receipts are going to be up tremendously,” said Meridian farmer Sid Freeman.
But, he added quickly, “Farm production expenses are way high also.”
“There are some very substantial increases in farm production costs this year,” said Brune.
That means that while gross farm revenue will be up substantially this year, there’s no guarantee net farm income, which is the farmer’s paycheck, will also be up.
According to the U of I’s Financial Condition of Idaho Agriculture report for 2021, total expenses for the state’s farmers and ranchers last year were up 8 percent compared with 2020, reaching a record $7.8 billion.
Idaho’s record for total farm-gate receipts, $8.9 billion, was set last year, nipping the previous record of $8.8 billion set in 2014, but total net farm income in the state actually decreased 8 percent last year, to $2.4 billion.
The reason for that decrease was a large year-over-year increase in total farm production costs in 2021. Farm and ranch expenses are again expected to increase substantially this year.
“We’re seeing record high commodity prices and record high farm expenses,” Freeman said. “The net margins, I believe, will be narrower this year.”
Eborn, owner of North American Potato Market News, said potato production costs in Idaho will be up about 20 percent this year compared with 2021.
“Costs are sky-high,” he said.
Many farmers across the state are reporting good yields this year and if realized, that will boost growers’ total income and help offset some of the input cost increases, Freeman said.
“There are some pretty good yields out there,” Taylor said. “We’re talking very good yields.”
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