Idaho 2007 Ag Receipts, Net Farm Incomes Skyrocket

By Bill Loftus, University of Idaho
Thursday, January 3, 2008 6:18 PM CST

BOISE, Idaho — If farming is a gamble, it paid off big for Idaho agriculture in 2007.

University of Idaho College of Agricultural and Life Sciences economists estimate Idaho agriculture will collect record-high cash receipts of $5.6 billion in 2007.

That total reflects strong markets for beef, dairy, potatoes and wheat, and nearly all of the state’s other crops. Cash receipts rose 25 percent, or $1.1 billion, from 2006.

The high prices for livestock, milk and crops produced an even happier statistic for the state’s agricultural producers: a 78 percent increase in net farm income. That meant farm revenues, which rose 21 percent, outstripped even a 10 percent overall increase in expenses.

The report, The Financial Condition of Idaho Agriculture: 2007 Projections, is the fifth in an annual series. It was prepared by agricultural economists Ben Eborn, University of Idaho extension educator in Teton County; Paul Patterson, extension agricultural economist at Idaho Falls, and Garth Taylor, Agricultural Economics and Rural Sociology Department regional economist at Moscow.

College of Agricultural and Life Sciences Dean John Hammel presented the report to members of the Idaho Legislature’s Joint Finance-Appropriations Committee on Jan. 3.

"Idaho agriculture benefited from strong demand for milk, beef, potato and wheat," Hammel said. "This report shows agriculture remains an important part of the state’s economy."

The report also highlighted fundamental changes in Idaho agriculture, Hammel said, noting it reflected the seventh straight year that livestock revenues outpaced crop receipts. Livestock are projected to contribute 57 percent of cash receipts in 2007.

The state’s rapidly growing dairy industry rose to the top as the top cash cow, generating receipts of $2.04 billion, a 59 percent increase from $1.28 billion in 2006. Sales of beef cattle and calves generated another $1.07 billion to carry the livestock sector to $3.22 billion for the year.

Potato sales of $721 million, an all-time high, led crop receipts. Wheat sales totaled $511 million. Together, the two crops accounted for more than half of the crop sector’s receipts.

"Idaho agriculture is bigger now than it ever has been," Taylor said. "The overall picture is that Idaho agriculture is concentrating in the big four products and losing the diversity that has helped provide the level of stability enjoyed in the past decade."

The high prices for fuel, fertilizer and other supplies that high prices overcame in 2007 can be expected to remain a threat in 2008, Taylor said.

Overall, agricultural cash receipts typically show steady but more modest growth as different crops and livestock sectors post gains and losses.

This year’s report shows nearly every sector was a winner with the exception of sugar beets, which suffered both a decline in production and lower prices to drop receipts 13 percent to $207 million.

From the balance sheet, Taylor noted government payments were down 23 percent to $108 million as growers took advantage on high crop prices and exercised their traditional flexibility. In states where corn, soybeans and cotton are principal crops, price supports typically exert greater influence on growers’ choices.

The report is available on the Internet at http://www.ag.uidaho.edu/aers/r_outlooks.htm.

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