NEWS for North Dakotans
Agriculture Communication, North Dakota State University
7 Morrill Hall, Fargo, ND 58105-5665

April 29, 1999

Red River Valley Farm Income Down in 1998

The average net farm income of Red River Valley farms enrolled in North Dakota and Minnesota's Farm Business Management Education Program plummeted to $20,600 for 1998. Down from $37,000 in 1997, the 1998 figure represents a drop of 45 percent, says an agricultural economist with North Dakota State University.

"This is the second consecutive year of sharp declines in farm income in the Red River Valley," says Andrew Swenson, farm management specialist for the NDSU Extension Service. "Last year nearly 40 percent of the farms had negative net farm income. Particularly hard hit was Clay County, Minn., where 62 farms in the program averaged a negative net farm income of $15,600—in large part because of low returns to sugarbeets."

Red River Valley farms enrolled in the Farm Business Management Education Program typically are large enough to generate enough net income to pay income taxes and family living expenses—but not in 1998, Swenson says. Average farm size is nearly 1,500 cropland acres, of which 78 percent is rented. On average, the farms generate a gross income of nearly $400,000.

On cash-rented land, the 197 farmers participating in the program lost, on average, $28 per acre on wheat and $47 per acre on barley. Although corn yields averaged 114 bushels per acre, there was a loss of $10 per acre on cash-rented land. Crops that showed some profit, on average, were dry edible beans, soybeans, canola and sunflowers.

Swenson says the report, based on the Farm Business Management data, is designed to help Red River Valley farmers make more informed management decisions by providing measures of comparison to other farms in the area. Detailed 1998 costs and returns for each crop enterprise are included in the report. The study also might be useful to educators, bankers and consultants.

The report costs $5 (plus handling and shipping) and can be ordered in Minnesota by writing to Robert Bollesen at Northland Technical College, Highway 1 East, Thief River Falls, MN 56701. Bollesen can be reached by telephone at (218) 681-0797. North Dakota producers interested in the report can write to Farm Business Management, P.O. Box 6022, Bismarck, ND 58506, or they can call (701) 328-3162. The report also is available via Internet at http://www.mgt.org/fbm/reports/1998/valley/valley.htm.

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Source: Andrew Swenson (701) 231-7379

Editor: Dean Hulse (701) 231-6136