Farm Talk

Ag News from Around the Country

January 31, 2012

Record farm profits could stumble in ‘12

Parsons, Kansas — Against a backdrop of economic uncertainty, U.S. agriculture last year stood as a shining example of growth.

2011 set records, with net farm income topping $100 billion for the first time ever.

“Prices are up across the board for all the major crops, and while we’ve seen cost of production increases overall, they haven’t increased as rapidly as the prices of crops people are selling,” said Pat Westhoff, director of the University of Missouri Food and Agricultural Policy Research Institute (FAPRI). “Even corrected for inflation, farm profits are at or near the highest levels since the 1970s. That is indeed a very good outcome overall.”

U.S. farm income rose 28 percent in 2011 compared to the previous year, according to USDA reports.

Record agricultural exports topped $137 billion, while crop receipts rose 16 percent and livestock sales receipts averaged 17 percent more than in 2010.

For livestock producers, this year offers welcome relief from some tough times. When the economic recession hit, prices dropped sharply as demand for meat slumped, and high feed prices meant many livestock producers lost money.

In response, some producers stopped raising livestock and others scaled back expansion plans. Westhoff said we’re seeing a turnaround.

“We’ve seen higher prices for both hogs and cattle this year in a pretty sharp way after really tough years in 2008-2009,” he said. “Now we’re seeing a bit stronger demand for our meat overseas and at the same time we’ve got less supply.

“Events like the drought in Texas have reduced cattle numbers, so there will be less beef to be sold in 2012. That will help keep cattle prices high ahead of us for the next several years.”

Going into 2012, chicken producers won’t be as lucky. Demand for chicken has not kept pace with the appetite for red meat, and there is an expectation that chicken production will consolidate soon.

“That’s causing talk of lower chicken production in 2012, and that’s something that doesn’t happen very often,” Westhoff said.

Crop exports likely will fall short of last year.

With less droughts and floods affecting foreign yields, competition will ramp up once again.

“Less soybeans, less corn, less wheat almost certainly will be exported in the current marketing year than last year,” Westhoff said. “It’s not that demand is necessarily weak, it’s just lots of other countries are supplying those foreign markets.”

It’s hard to guess whether 2012 will bring another round of high prices, but higher yields, weaker exports and even the European debt crisis could hinder a repeat.

“There are lots of things that could go wrong in front of us, and instead of $5-$6 corn, $3-$4 corn could return,” Westhoff said. “We’re very much in a volatile situation, and what people think about the markets today will be different than six months or a year from now.”

MU FAPRI provides economic analysis about agriculture issues and proposed legislation. It is funded in part by the MU College of Agriculture, Food and Natural Resources.

Text Only
Ag News from Around the Country
  • MANURE34.jpg Manure Expo aids nutrient management

    Valuing manure and the environment was the platform for the 2014 Manure Expo held at the Ozark Empire Fairgrounds in Springfield, Mo.
    The two-day exposition pulled together the resources of over 70 vendors from the U.S. and Canada along with the expertise of Extension professionals from Missouri, Oklahoma, Nebraska, Wisconsin, Ark-ansas, Pennsylvania and Ohio.

    July 22, 2014 2 Photos

  • Okla. farmer’s lost phone turns up at Japan grain mill

    TULSA, Okla. (AP) — Oklahoma farmer Kevin Whitney thought his iPhone was lost for good when it fell into a grain elevator last year. Eight months later, his phone was returned unscathed after a trip to Japan.

    July 15, 2014

  • Combustible grain dust prevention workshop, July 31

    Kansas State University will offer a combustible grain dust prevention workshop teaching advanced mitigation methods on July 31, 2014 from 1 to 4 p.m. at the Westin Crown Center Hotel in Kansas City, Mo.

    July 8, 2014

  • House discusses new federal schemes to soak up water authority

    Last week, the House Natural Resources Committee’s subcommittee on water and power held an oversight hearing entitled “New Federal Schemes to Soak Up Water Authority: Impacts on States, Water Users, Recreation, and Jobs.”

    July 1, 2014

  • USDA to ‘cure’ feral hogs

    A preservative used to cure bacon is being tested as poison for feral hogs.

    June 24, 2014

  • Cargill to move sows to group housing by 2015

    Cargill, one of the largest pork producers in the U.S., is continuing its commitment of moving to group housing for its sows that produce hogs for pork.

    June 17, 2014

  • Bethany-Schifferdecker.jpg Girard FFA member elected state VP

    Bethany Schifferdecker from the Girard FFA chapter was elected to serve as the 2014-2015 state FFA vice-president at the 86th Kansas FFA Convention May 28-30 on the Kansas State University campus.

    June 10, 2014 1 Photo

  • thorpe_dairy.jpg Couple goes ‘Kiwi’ for grassfed dairy

    Not many people would move nearly 8,000 miles away to work on a dairy farm.

    June 3, 2014 1 Photo

  • NOAA Seasonal Drought Outlook

    As of May 13, 2014, drought covered approximately 38 percent of the contiguous 48 states, according to the U. S. Drought Monitor.

    May 28, 2014

  • Cattlemen offer up to $10,000 reward for cattle theft case

    A local rancher and member of the Oklahoma Cattlemen’s Association recently had 27 head of cattle stolen.  The cattle were taken from the Robson Ranch near Claremore, Okla.

    May 21, 2014

Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Seasonal Content