Home / Farm Management / Finances, Accounting, and Taxes / Illinois farm income seen down by half

Illinois farm income seen down by half

Agriculture.com Staff 01/05/2006 @ 1:30pm

The average net farm income for grain growers in Illinois is expected to drop by 50% in 2005 compared with 2004, according to a recent University of Illinois Extension study. Lower corn yields, lower grain prices and higher input costs are the primary reasons, the researchers say. Still, average income is expected to be higher that it was in 2001 and 2002.

"Farm incomes are projected to be over $47,100 per farm lower in 2005 compared to actual farm incomes in 2004," said Dale Lattz, U of I Extension farm financial management specialist, who co-authored the study with colleagues Gary Schnitkey and Paul Ellinger.

Read the full report, "Considerably Lower Farm Incomes Projected for 2005," at farmdoc: http://www.farmdoc.uiuc.edu/manage/newsletters/fefo05_24/fefo05_24.html .

The study was based on data compiled from 805 grain farms enrolled in the Illinois Farm Business Farm Management (FBFM) Association.

"Average net farm income in 2005 is projected at $43,600 per farm, down by over 50% from actual farm income of $90,700 in 2004," said Lattz.

"These 805 farms averaged $54,300 from 2001 through 2004. Hence, the 2005 net farm income is projected to be below the previous five-year average income. "

Lattz noted that incomes in 2005 would have been lower still if government farm payments had not increased in 2005 as compared to 2004.

"Due to yield variability, projected incomes vary substantially across crop reporting districts," Lattz said. "The highest incomes - $65,800 to $68,500 - are projected in the west-southwest and east districts in the state.

The lowest income is projected in the northeast district - $16,400. Incomes in the other districts range from $24,400 in the southwest district to $48,700 in the central district.

"The projected incomes for all districts are considerably lower than the year before," Lattz said.

The study used yield projections from the Illinois Agricultural Statistic Service.

The average net farm income for grain growers in Illinois is expected to drop by 50% in 2005 compared with 2004, according to a recent University of Illinois Extension study. Lower corn yields, lower grain prices and higher input costs are the primary reasons, the researchers say. Still, average income is expected to be higher that it was in 2001 and 2002.

CancelPost Comment
MORE FROM AGRICULTURE.COM STAFF more +

Farm and ranch risk management resources By: 07/07/2010 @ 9:10am Government resources USDA Risk Management Agency Download free insurance program and…

Major types of crop insurance policies By: 07/07/2010 @ 9:10am Crop insurance for major field crops comes in two types: yield-based coverage that pays an…

Marketing 101 - Are options the right tool… By: 07/07/2010 @ 9:10am "If you are looking for a low risk way to protect yourself against prices moving either higher or…

MEDIA CENTERmore +
This container should display a .swf file. If not, you may need to upgrade your Flash player.
Cool Tools Christmas Edition: Part 2