2007 Minnesota Farm Financial Update
April 25, 2008
The 2,574 Minnesota farms included in the FINBIN database represent a broad cross-section of Minnesota production agriculture. While there is no “typical” Minnesota farm, these farms include a large enough sample to provide a good barometer of commercial farming in Minnesota. FINBIN data is provided by farms that participate in MnSCU Farm Business Management Education programs and the Southwest Minnesota Farm Business Management Association. These farm represent about 3 percent of the farms in the state and 18% of the larger commercial farms – those that grossed over $250,000 in 2007.
Highlights
- The median net farm income per farm was $105,431. Median income per operator was $94,617.
- The average net farm income per farm was $155,966, a 62% increase from 2006. The average was substantially higher than the median, indicating that the most profitable farms were so profitable that they increased the average for all farms.
- The average farm earned a rate of return on assets (ROA) of 14% compared to 9.3% in 2006 (based on adjusted cost or book valuation of assets).
- Crop farm profits increased by an average of 73% to $186,313. Of this, $123,918 resulted from the increased value of inventories held at the end of the year.
- Dairy farm profits rebounded, increasing by 136% to $153,393, as the average price received for milk increased from $13.34 in 2006 to $18.63 per hundredweight in 2007.
- Hog farms, which include specialized finishing operations and traditional farrowing farms, saw their profits fall by 33% to $134,809. This decline in profits resulted mostly from increased costs, in particular feed costs, as prices paid and prices received were not substantially different from the previous year.
- Beef farms, which include both cattle finishing and cow-calf operations, earned a 60% increase in net farm income to $79,972. Part of this increase is likely due to the increased profitability of their cropping operations.
- Government payments of all types declined by 46%. Total government payments represented 2.4% of gross revenue and 10.1% of net farm income.
- The average farm’s net worth increased by over $129,000. Again this is skewed toward the most profitable farms; median net worth change was $92,300.
- Farms in all regions of the state participated in the increase in farm earnings over 2006 levels. Farms in the Southwestern region earned the highest median farm income. The median income of farms in the North Central/East Central region more than doubled over their depressed 2006 levels.
|
 |
