2016 a mixed financial bag for Minnesota farmers, ranchers
Minnesota farm income rose by about a third last year but many producers are still struggling with low grain and livestock prices.
An analysis of more than 2,000 farms by Minnesota State and University of Minnesota researchers shows a median net income of $35,636 per operation in 2016 compared to $27,478 in 2015. Most of the improvement came in crop production.
Record corn and soybean yields helped offset the impact of low grain prices, said Northland Community and Technical College farm business management instructor Ron Dvergsten.
"Those extra bushels in the bin saved many our farms from near disaster," said Dvergsten.
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Livestock producers did not do as well. Dairy farmers saw profits drop by about a third. Hog producers lost about $4,000 per operation. Beef producers did even worse, losing about $11,000 per farm in 2016, said Dvergsten, noting that cattle prices were the culprit.
"We saw about a 40 percent reduction in the value of market animals over what we saw in 2015," said Dvergsten.
Last year marked the fourth straight year of below-normal profits for Minnesota farmers. The decline comes after a run of record earnings in 2010 through 2012; when median net income for the farms in the study topped $100,000 each year.
Since then, grain and livestock prices have fallen. The current cash price of corn in Minnesota is about $3.20 a bushel, less than half what the grain brought in the peak income years.
The income report concludes "some farms will have to make major adjustments in the coming year in order to continue farming."