overview
The farm business environment is more competitive and more international
in scope than ever before. Managers must not only be highly skilled
and knowledgeable of production techniques, but have to confront
many complex financial decisions. Farming is a business with considerable
uncertainty and risk. The major goals of this ERS research
program are to provide objective and timely economic analyses of
the financial conditions in agriculture,
to assess how current and emerging production technologies affect
farms and whether these changes pose special risks to farm financial
viability, and to determine whether farmers' use of adaptive management
strategies contributes to economic success. More
overview...
feature
Assessing
Farm Household Well-being—Beyond Farmers and Farm Income
—The median farm household has higher income as well as higher
wealth than the median nonfarm household. However, the median nonfarm
self-employed household has a higher level of income than the median
farm household, and a roughly-similar level of wealth. Providing
an interesting perspective on the relevance of seeking parity for
today's farmers are the findings indicating that the ranking of
the well-being of farm households relative to nonfarm households
depends not only on which well-being indicator is used but also
which reference population is used.(01/04)
Demand
for Farm Credit Expands, But Farm Lenders Remain CautiousThe
four major categories of institutional lenders serving the farm
sector, commercial banks, the Farm Credit System (FCS), the Farm
Service Agency (FSA), and life insurance companies, provide credit,
and keep a cautious eye on farm debt trends, interest rates, and
farm debt repayment capacity. All are showing low levels of delinquencies
and loan problems. The stability of their farm loan portfolios is
benefiting from large government payments, sizable amounts of off-farm
income, and an enhanced crop and revenue insurance program. Total
farm business debt at $201.9 billion, increased 5.1 percent in 2002.
The expected 3.9 percent increase in 2003 will be the eleventh consecutive
annual increase. Despite price and weather problems facing some
commodities, the supply of farm credit remains adequate and lenders
appear confident about most of their farm customers. (04/03)
recommended readings
Characteristics and Production
Costs of U.S. Dairy Operations —The total costs of producing
milk vary across the U.S. Milk producers in the West had a significant
cost advantage in 2000 over producers in other regions because their
operations were much larger. Operations with 500 or more milk cows
had significantly lower operating and ownership costs, indicating
economies of size. Also, differences in animal performance, feed
efficiency, and labor efficiency were critical in determining whether
producers were in the low- or high-cost group for producing milk.
(02/04)
Characteristics and Production
Costs of U.S. Wheat Farms Total costs of producing wheat in
1998 averaged $3.97 per bushel or $165.53 per acre, but varied widely
by region, farm size, and other characteristics. Costs were generally
lower in the Prairie Gateway region than in the Southeast, and generally
lower on large farms than on small farms. About 85 percent of surveyed
farms covered their operating costs at the average farm price of
wheat in 1998 ($2.65 per bushel). Fewer were able to cover the full
range of costs associated with production (including ownership costs
and the opportunity cost of farmers' labor). SB-974-5 (7/02)
Determinants of Financial Performance
of Commercial Dairy FarmsData from the 1993 Farm Costs
and Returns Survey revealed regional differences in the way extensive
indebtedness, size of operation, and labor cost affect net farm
incomes of dairy operations. Size of the operation, regardless of
location, was identified as the factor contributing most to the
variability in net farm income.
See all recommended readings...
recommended data products
Farm Financial Management
DataTables, graphs, and downloadable spreadsheets on farm
business finances and characteristics and farm households from the
Agricultural Resource Management Survey (ARMS). Now updated to 2001.
Farm Household
Finances DataTables and downloadable spreadsheets on farm
household finances classified by the ERS typology from ARMS data.
Now updated to 2001.
Farm Operator
Characteristics DataTables and downloadable spreadsheets
on farm finances by farm operator and operation characteristics
classified by the ERS typology from ARMS data. Now updated to 2001.
recent research developments
What we've accomplished lately,
including links to new journal articles, briefing presentations,
etc.
questions and answers
Succinct treatment of timely issues
related to farm financial management.
our newsletters
Agricultural
Income and Finance Situation and OutlookProvides historical
estimates and forecasts of farm sector financial information that
will allow you to gauge the financial health of the Nation's farmers
and ranchers.
related briefing rooms
Farm income and costs
Farm risk management
Farm structure
Agricultural Resource Management Survey (ARMS)
related links
Links to other USDA and Federal agencies
concerned with farm financial management.
for more information, contact:
Mitch Morehart or Ashok
Mishra
web administration: webadmin@ers.usda.gov
page updated: August
17, 2004
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