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December 16, 2004 Sugar Beet Industry Generates $3 Billion in 2003 The sugar beet industry generated more than $3 billion in economic impacts in 2003, according to a recent study by North Dakota State University agricultural economists. The region covered in the study included growing areas and processing plants in the Red River Valley, west-central Minnesota and northwestern North Dakota/northeastern Montana. In 2003, these areas accounted for 776,348 acres planted to sugar beets and 14.5 million tons were processed. “Sugar beets continue to be produced in a relatively small geographic area and on relatively limited acreage in Minnesota, North Dakota and eastern Montana,” says F. Larry Leistritz, NDSU Department of Agribusiness and Applied Economics. “These factors, along with the continued debate over policies affecting the domestic sugar industry and recent industry expansions, justify a continued assessment of the economic importance of the sugar beet industry to the regional economy.” The direct impact from expenditures from processing and marketing activities and combined expenditures and net returns from sugar beet production were estimated at $1.1 billion. The $1.1 billion in direct impacts generated another $2 billion in secondary impacts. In 2003, the sugar beet industry employed 2,628 full-time equivalent workers, and based on total business activity, supported an additional 29,258 fulltime equivalent jobs in the tri-state area. Also, the sugar beet industry generated about $62.6 million in tax revenue, including tax collections of $41.9 million in Minnesota, $18.9 million in North Dakota and $1.8 million in Montana. The sugar beet industry has experienced substantial real (inflation-adjusted) growth in the last 15 years. “Planted acreage in eastern North Dakota and Minnesota increased 60 percent from 1987 to 2003 and the tons processed increased by 93 percent,” Leistritz says. “In real terms, gross business volume generated by the industry in Minnesota and North Dakota has increased by 76 percent since 1987.” Not only was the dollar volume of business activity considerable, but most processing plants are in rural areas of the three states. The size of the sugar beet growing area suggests much of its economic activity affects rural economies. Economic activity in other sectors of the economy may sometimes represent a concentration of economic activity in one or two major cities or a few large firms. Leistritz and Dean Bangsund co-authored the report. The complete report is available at http://agecon.lib.umn.edu/. ### Source:
F. Larry Leistritz, (701) 231-7455, f.leistritz@ndsu.edu |
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North Dakota State University |
