Nebraska producers’ expenses up 14 percent in 2007

While farm commodity prices have increased, a new report from the U.S. Department of Agriculture shows just how much the cost of growing those commodities has also risen.

USDA's National Agricultural Statistics Service, Nebraska Field Office reported Thursday that farm and ranch production expenditures for Nebraska totaled $14.6 billion in 2007, up 14 percent from a year earlier.

The largest expenditure category is livestock expenses, at $4.17 billion, as they increased 10 percent from 2006.  Feed, the next largest total expense category at $1.78 billion, increased 22 percent from 2006. 

According to the USDA report, the category showing the largest percentage increase over the previous year is trucks and autos at 47 percent. 

Livestock expenses accounted for 29 percent of Nebraska's total production expenditures. Feed accounted for 12 percent, rent 10 percent, and farm services 9 percent.

Last year, according to the USDA, Nebraska's cattle industry had a gross income of $7.1 billion, with hogs at $765 million. The gross income for corn was $5.88 billion; soybeans, $1.89 billion; all hay baled, $546.8 million; and winter wheat, $522.5 million.

The total expenditures per farm or ranch in Nebraska averaged $309,091 in 2007, up from $269,538, an increase of 15 percent. 

The livestock expense category was the leading expenditure, at $88,161 per operation, almost seven times the national average. 

The average feed expenditure, at $37,632 per operation, was more than twice the national average. 

Rent and farm services, at $29,810 and $27,273, respectively, were both above the national average.  

Nationwide, U.S. farm production expenditures totaled $260 billion in 2007, up 9.3 percent from the revised 2006 total of $238 billion. 

The largest percentage contributors to the increase were fertilizer, lime, and soil conditioners, up 26 percent; feed, up 21 percent; fuels, up 14 percent; agricultural chemicals, up 11 percent; and tractors and self propelled equipment, up 11 percent. 

For the first year ever, the USDA reported that the trend for all expense items was higher than the previous year, except for miscellaneous capital expenses, which were unchanged.                                                                              

The top three average expenditures per farm with the largest dollar increase were: feed, up $3,335, or 22 percent; fertilizer, lime, and soil conditioners, up $1,684, or 26 percent; and farm services, up $1,210, or 7.9 percent. All other per farm average changes were less than $900 per farm.                                                                           

Total fuels expense, at $12.7 billion, was up 14 percent in 2007. Diesel, the largest subcomponent, was $7.71 billion, accounting for 61 percent of the fuels expense. Gasoline was $2.74 billion, up 16 percent. LP Gas was $1.5 billion, up 17 percent.  Other fuels totaled $750 million, up 4.2 percent.                                                                              

Fuel prices and weather were two large factors affecting farm production expenditures during the year, the USDA reported.

In 2007, the USDA said that the average per farm U.S. total farm expenditure was $125,648, compared with $114,186 in 2006, for an increase of 10 percent. 

On average, U.S. farm operations spent: $18,412 on feed, $16,575 on farm services, $12,903 on livestock and poultry purchases, $12,564 on labor, $8,988 on rent, and $8,070 on fertilizer, lime, and soil conditioners. 



Top states in agriculture expenditures                                                                                   

The sum of total expenditures for the top farming states was $168.3 billion in 2007 (65 percent of the U.S. total) and $152.5 billion in 2006 (64 percent). 

-- California contributed most to the 2007 U.S. total farm expenditures, with expenses of $27.1 billion, or 10 percent of the U.S. total expenditures. 

-- Texas contributed 7.6 percent to the 2007 U.S. total farm expenditures. 

Other states with more than $10 billion in total expenditures were:

-- Iowa with $17.3 billion (2006 -- $15.0 billion);

-- Nebraska with $14.6 billion (2006 -- $12.8 billion);

-- Kansas with $12.4 billion (2006 -- $10.3 billion);

-- Minnesota with $11.8 billion (2006 -- 10.4 billion);,

-- Illinois with $11.4 billion (2006 -- $10.1 billion).