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Idaho's farm sector still strong, but slowing

Published on May 7, 2013 3:01AM

Last changed on May 7, 2013 7:30AM


Capital Press

BOISE -- Idaho's farming sector continues to lead the state's gains in personal income but there are signs the Gem State's agricultural economy, while still strong, is starting to slow.

Total per capita income in Idaho rose 3.3 percent to $53.85 billion in 2012, finally returning to its pre-recession peak, according to the Idaho Department of Labor.

The farming sector was a big reason for that increase, as total personal income in that category increased 7.45 percent to $2.31 billion, a $150 million gain and the largest percentage increase among the Idaho economy's main economic sectors.

Personal income is the value of all wages, business profits, investment earnings and government transfer payments such as Social Security and unemployment benefits.

Since the farming sector's personal income total nose-dived 22 percent in 2009, it has led Idaho's gains in personal income the past three years, increasing 11 percent in 2010, then 35 percent in 2011 and 7.45 percent in 2012.

"Except for the first year of the recession, those farm earnings have been steadily growing," said IDL spokesman Bob Fick.

But last year's percentage increase slowed compared to the two previous years, and farmers also say things are starting to slow.

Prices for many commodities have leveled off or dropped but costs continue to rise, said Shelley, Idaho, farmer Stan Searle, a potato and grain farmer. While things were good last year, the situation has changed, he said, especially in east Idaho, where the bulk of the state's potato crop is grown.

Spud prices right now are well below the cost of production, Searle said.

"I don't think the numbers are wrong as far as what happened last year, but I just know what's happening now," he said. "I don't anticipate it being a high-profit year."

University of Idaho ag economists say that while 2013 will be another good year for Idaho agriculture, total cash receipts will decline and expenses will continue to rise. UI's 2013 outlook anticipates crop cash receipts will be down 5-8 percent to about $3.2 billion and livestock cash receipts will be up 2-3 percent to about $4.4 billion.

Together, those totals would equal about $7.6 billion, which would be $100 million less than the record $7.7 billion in cash receipts Idaho agriculture totaled in 2012.

UI economists are also forecasting expenses will rise 3-5 percent to about $6.4 billion this year, and total net farm income will decline 15 percent to $2.2 billion, down from last year's record $2.57 billion mark.

That forecast assumes a decline in grain, sugar, hay and dry bean prices for Idaho farmers and a forecast tight water year could be a major factor, said UI ag economist Paul Patterson.

While prices for most farm commodities are still generally good, the cost of farming keeps rising, said Fruitland, Idaho, farmer George McClelland.

"Prices are up pretty good but of course costs are up, too," he said. "The cost of operating is steadily increasing."


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