Minnesota Farms See 63% Drop in Farm Income in 2009
Jul 07, 2010
Of the 2,401 Minnesota farms included in the "FINBIN" survey for 2009, the median farm saw a 63% decrease in net income from $91,242 to $33,417. Each year, the Center for Farm Financial Management performs a survey of Minnesota farmers. Their response for 2009 represented about 3% of overall farms and about 10% of the farms with total sales over $100,000.
A summary of the results for 2009 show the following:
- Median farm income peaked in 2007 at about $105,000 and have declined in two years to about $33,000. The 2009 numbers are also the worst net income for any year in this decade other than 2001, when the median net income was about $24,000.
- Incomes were down substantially for virtually every type and size of farm.
- Livestock farms of all types, on average, did not provide enough income to support family living expenses.
- While crop farms were more profitable than livestock farms, the median earnings of crop farms dropped 55% to about $60,000.
- Dairy farm profits were down substantially, falling to an average of about $5,000 per farm. The average price for milk dropped from about $19 to $13 in one year.
- Hog farms eked out a small profit as their income dropped about 87%.
- The average return on assets dropped from 10.5% in 2008 to 3.1% in 2009.
- The average farm's net worth increased by about $60,000. However, almost all of this increase was due to increasing land prices and not earned net worth growth.
- The average farm spent $52,000 on living expenses and needed to generate $72,000 from farm and nonfarm income to cover family living, income taxes and other ongoing nonfarm expenses.