Farmers play a vital role in economic development for rural communities
The final results are in for the 2013 Annual Report which provides a summary of financial data from farms enrolled in the S.D. Center for Farm/Ranch Management at Mitchell Technical Institute. Overall, the average operation saw cash expenses reach $903,743, up slightly from 2012. Several individual expense categories showed decreases from last year, which is good news for producers as cash income levels were also down slightly from one year ago.
For most farms enrolled in the program, livestock production still ranks as the top source of revenue and it therefore represents the biggest area of expenses with about $341,000 in direct costs. Most of these dollars are spent purchasing feeder livestock and buying feed products. It should be noted that this activity is a real economic engine for South Dakota as most of the feed is produced and processed in South Dakota.
In 2013, crop input prices reflected a modest 5% increase from one year ago and totaled $236,715. Seed, fertilizer, chemical, and crop insurance are the main inputs and totaled $272/acre for corn and $129/acre for soybeans last year. Many farmers now rely on a variety of consultants and this supports several people who are employed by local farm cooperatives and other private agricultural companies.
Another important industry that farmers support is implement dealers, farm supply businesses, and local repair shops. The average farm spent just over $52,000 in repairs last year. Fuel expenses are another big expense and totaled $38,916 in 2013. In addition, most farm operations cannot exist without a good relationship with a local lender plus reliable employees. Also, many farmers are hiring custom operators to assist with planting, harvesting, spreading manure, etc. Lastly, landlords have benefitted from strong commodity prices and good yields with the average producer paying close to $108,000 in cash rents during 2013.
In addition to spending $903,743 in operating costs, farmers invested an average of $86,244 in capital purchases such as land, buildings, machinery, and breeding livestock. Family living expenses totaled $70,094 in 2013 and came in 9% higher than last year. Other non-farm expenditures equaled $88,112 which is down slightly from last year.
Overall, the average farm spent close to $1,100,000 in the areas noted above which explains why agriculture plays a major economic role in communities throughout South Dakota.
The S.D. Center for Farm/Ranch Management program is offered through Mitchell Technical Institute and is available to all producers who desire to improve their recordkeeping and decision-making skills. For more information about the data in this article or about the programs offered, call 1-605-995-3098 or email email@example.com.