NEWS for North Dakotans
Agriculture Communication, North Dakota State
University
7 Morrill Hall, Fargo, ND 58105-5665
March 26, 1998
Average net farm income of north central North Dakota farms enrolled in the North Dakota Farm Business Management Education program dropped to $22,528 in 1997, down 34 percent from the previous year, according to a new report.
"Nearly one-fourth of the farms in the region managed to exceed $40,000 net farm income," says Andrew Swenson, farm management specialist for the North Dakota State University Extension Service. "But one-half had income less than $16,000, and nearly one out of every four had negative net farm income."
1997 farm profit in the north central region of the state was the lowest it has been since 1989—and it came far short, on average, of covering the $35,000 typically needed for family living expenses and income taxes.
"Off-farm wages in the region," says Swenson, "averaged $8,664 in 1997, up from previous years—and probably a symptom of the need to supplement farm income."
The farms included in the study were in the Devils Lake, Rugby, Bottineau and Minot areas. Most failed to meet Swenson's rule-of-thumb estimate of long-term average net returns in that region: $20 per crop acre and $100 per beef cow.
Spring wheat, the dominant crop enterprise in the region, averaged minus $11 net per acre. Durum averaged $19 per acre, barley $4.60, canola slightly over $30 per acre, sunflowers $25.
"Average return per beef cow," says Swenson, "was $59—a substantial increase from 1996, but still paltry."
The north central region experienced strong net farm income from 1992 to 1994 on the strength of durum and beef cattle. Farm balance sheets improved significantly in that period, says Swenson. But net farm income has dropped off markedly since 1994, and now the average debt-to-asset ratio in the region exceeds what it was 1991, prior to the gains made in the high-profit years.
Swenson says the report is designed to help farmers make management decisions by providing measures of comparison to other farms in the area. Detailed 1997 costs and returns for each crop enterprise are given. The study also might be useful to educators, bankers and consultants.
The report costs $5 plus handling and shipping, and can be ordered from Farm Business Management, P.O. Box 6022, Bismarck, ND 58506, telephone (701) 328-3162.
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Source: Andrew Swenson (701) 231-7379
Editor: Barry Brissman (701) 231-7866
Click here for a pdf version of this graphic.