By SEAN ELLIS
BOISE -- University of Idaho economists recently presented lawmakers the results of studies that show agriculture is the biggest part of the state's economy and its importance is growing.
A UI study based on the most recent data available shows that agribusiness in Idaho is responsible for $19 billion in total sales and represents about 18 percent of gross state product, making it the biggest sector of the state's economy.
Agribusiness directly and indirectly accounts for 101,000 jobs, 12 percent of the state's total workforce, ranking it No. 2 in that category.
Ag employment has remained stable in recent years because of efficiency gains, but farming's contribution to gross state product is increasing, UI ag economist Garth Taylor told members of the House Agricultural Affairs Committee.
"Ag produces big, fat, bulky things efficiently and it's going to get more efficient," he said. "But that's going to create more gross state product, and that's the whole point."
Idaho agriculture set records for total farm gate receipts and net income last year, but Idaho farmers are unlikely to improve on those records in 2013, UI ag economist Paul Patterson said.
"It was a good year for agriculture overall," Patterson said, but a decline in prices for several major commodities grown in Idaho should lead to a small decrease in cash receipts and net income in 2013, he added.
UI is forecasting Idaho crop cash receipts in 2013 to decline 5 to 8 percent to between $3.1-$3.2 billion and livestock cash receipts to be increase 2-3 percent to between $4.4-$4.44 billion. Combined, that would be slightly below the record $7.72 billion in cash receipts recorded in 2012.
UI predicts total expenses will increase 2-4 percent to between $6.25-$6.35 billion and net farm income will be down 10-15 percent to between $2.15-$2.34 billion, below the record $2.57 billion last year.
While growers who produce potatoes under contract are doing OK, returns on the fresh market are at $2.50 to $3 per hundredweight, well below the $8 per hundredweight growers spent to plant them, Patterson said.
Sugar prices are also down, which will affect the state's sugar beet growers, and dry bean prices are starting to move down also, he added.
"That was factored into (the) overall assessment," he said.
Patterson reminded lawmakers that UI economists also predicted total revenue and net income for Idaho farmers would decrease in 2012. That turned out not to be the case, a development he attributed to a severe drought in other states that drove up the price of grain and other commodities.
Taylor dissented from the official forecast and predicted Idaho farmers would again set revenue and net income records this year. He based that largely on an expected increase in milk prices and record high futures markets for beef.
Together, milk and beef represent 55 percent of the state's farm gate receipts.
"Because of those two things, I'm a little more optimistic," he said.