Iowa Public Television


Net Farm Income Rises

posted on November 12, 2004

The farm trade picture has been gloomy on a lot of fronts. To be sure, it's been a tough year for the U.S. Trade Representative's office -- the beef ban in Japan and elsewhere, GMO battles in Europe and Asia, and WTO spankings on U.S. subsidies, to name but a few.

But as it nears the start of its second term, the Bush administration says trade issues are among the items at the top of its agenda. And it's anticipated that trade issues will drive debate on farm matters in Congress, as well.

That's important because any changes to the farmer-friendly 2002 farm law aimed at addressing trade disputes could impact the bottom line in rural America.

To date, farmers aren't feeling the pinch. In fact, USDA numbers out this week reveal it's been a record-setting year for farmer income.


Net Farm Income Rises

Net farm income in 2004 is expected to jump 24.5% over last year... to a record $73.7 billion dollars.

Six of the nine U.S. farm resource regions are expected to see an increase in their average cash income for 2004 ... where cash receipts may reach a record $233.4 billion dollars, $22 billion more than last year. Nearly $16 billion of the increase is credited to the livestock industry.

In cattle, despite the BSE scare in which several countries banned the importation of U.S. beef, prices for both animals and livestock products have increased.

Hog prices have rebounded from the lows of 2002.

Despite the cumulative effects of large harvests both this year and last year, prices for most crops in most months remained at or above respective averages for the prior 10 years.

Not all sectors of producers are doing so well.

Attributing some of the cause to the consumer popularity of the low carbohydrate diet ... potato farmers have faced a depressed market. To try to counter the pricing, more than 400 growers formed a new cooperative whose members have agreed to sell for nothing less than the weekly price set by the group's own economists and statisticians.

Meanwhile, farmers' expenses for inputs to produce crops and livestock are projected to rise by 8 percent in 2004 ... which is, on average, 2 percent less than the rise in receipts.


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