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  • Agricultural-Food Policy Review: Commodity Program Perspectives

    AER-530, July 01, 1985

    This review prepared for 1985 farm legislation provides an historical overview of U.S. farm policies, an evaluation of the performance of current commodity programs, a description of the general economic setting in which the legislation will operate, and a discussion of possible alternative policy tools and concepts. Particular focus is given to the purpose of commodity programs and an economic assessment of their performance.

  • Ethanol: Economic and Policy Tradeoffs

    AER-585, April 29, 1988

    Federally supported ethanol use is one alternative for meeting environmental, energy security, and agricultural objectives. Additional expansion of the industry depends on a continuation of current favorable conditions, including extension of the Federal gasoline tax exemption. Under current conditions, ethanol should be able to compete with other additives as an octane enhancer. Expansion of the ethanol industry would increase ethanol's contribution to improving energy security, reducing air quality problems associated with carbon monoxide, and increasing corn prices. The report provides a basis for assessing the tradeoffs in using ethanol to meet national objectives.

  • The Conservation Reserve Program: An Economic Assessment

    AER-626, February 01, 1990

    The Conservation Reserve Program (CRP) will boost net farm income and improve environmental quality over the life of the program (1986-99). These gains will come at the cost of somewhat higher food prices and Government administrative expenses, and potential downturns in farm input industries and other local economic activity tied to farming where enrollment is heavy. The authors estimated the net economic benefits of the program to range between $3.4 billion and $11.0 billion in present value, based on the effects covered in this report. Any estimate of the net Government expense of the CRP is highly dependent upon projected commodity market conditions and assumed levels of the acreage reduction program in the absence of the CRP. Prior to the 1988 drought, the authors estimated a small net Government expense. A more recent estimate made after the 1988 drought and with higher assumed acreage reduction levels in the absence of the CRP resulted in a significantly higher net Government expense.

  • Farmers' Use of Marketing and Production Contracts

    AER-747, December 01, 1996

    Contracts are an integral part of the production and marketing of selected livestock commodities, such as broilers, turkeys, eggs, and milk. Such crops as fruit, vegetables, and sugar beets and cane are mostly produced under contracts. In the past, farm receipts were assumed to be distributed across all farm families in proportion to their production. Today, contractors receive a large share of farm receipts, formerly assumed to go to the operator's family. Contractors typically bear a large share of production and price risk, and earn the majority of net income from the commodity's production. Farmers may benefit by being able to expand their operations more rapidly than otherwise possible--perhaps with less debt and fewer financial risks.

  • Structural and Financial Characteristics of U.S. Farms, 1993: 18th Annual Family Farm Report to Congress

    AIB-728, January 17, 1997

    In 1993, the 2.1 million farms in the contiguous United States operated an average of 436 acres and produced an average of $73,700 in agricultural products, as measured by gross sales. Characteristics of individual farms--including their level of production--varied widely, however. Most production occurred on relatively few commercial farms. Commercial farms (sales of $50,000 or more) were only 27 percent of U.S. farms, but accounted for about 90 percent of sales. Households with noncommercial farms (sales less than $50,000) relied on off-farm sources for virtually all of their income. U.S. farms are diverse, and variation within the industry is hidden by U.S. averages.

  • Financial Performance of U.S. Commercial Farms, 1991-94

    AER-751, June 01, 1997

    Commercial farms represent only 27 percent of farms in the United States, yet produce just over 75 percent of the value of agricultural products. These commercial farm businesses vary greatly by size, commodities produced, financial status, and operator demographics. Overall financial performance shows that the proportion of farms experiencing extreme financial stress remained stable over the last few years, and is considerably less than in the 1980s. Even as record levels of gross farm income are earned in this sector, expenses have increased as well, leaving farms in 1994 with average net farm income relatively stable in nominal terms over the previous 4 years.

  • Determinants of Financial Performance of Commercial Dairy Farms

    TB-1859, July 01, 1998

    This report uses standard econometric methods to identify important factors in financial performance of dairy farm businesses. On a per-unit-of-returns basis, factors found most important in explaining the variation in net returns per hundredweight of milk sold were cow's productivity, and per-cow forage production and purchased feed costs.

  • USDA Agricultural Baseline Projections to 2009

    WAOB-001, February 23, 2000

    This report provides long-run baseline projections for the agricultural sector through 2009. Projections cover agricultural commodities, agricultural trade, and aggregate indicators of the sector, such as farm income and food prices. The projections are based on specific assumptions regarding macroeconomic conditions, policy, weather, and international developments. The baseline assumes that there are no shocks due to abnormal weather or other factors affecting global supply and demand. The projections assume that current agricultural law of the 1996 Farm Act remains in effect throughout the baseline. The baseline projections presented are one representative scenario for the agricultural sector for the next decade. As such, the baseline provides a point of departure for discussion of alternative farm sector outcomes that could result under different assumptions. The projections in this report were prepared in October through December 1999, reflecting a composite of model results and judgmental analysis.

  • USDA Agricultural Baseline Projections to 2010

    WAOB-011, February 22, 2001

    This report provides long-run (10-year) baseline projections for the agricultural sector through 2010. Projections cover agricultural commodities, agricultural trade, and aggregate indicators of the sector, such as farm income and food prices.

  • Structural and Financial Characteristics of U.S. Farms: 2001 Family Farm Report

    AIB-768, May 25, 2001

    Family farms vary widely in size and other characteristics, ranging from very small retirement and residential farms to establishments with sales in the millions of dollars. The farm typology developed by the Economic Research Service (ERS) categorizes farms into groups based primarily on occupation of the operator and sales class of the farm. The typology groups reflect operators' expectations from farming, position in the life cycle, and dependence on agriculture. The groups differ in their importance to the farm sector, product specialization, program participation, and dependence on farm income. These (and other) differences are discussed in this report.

  • Wheat: Background and Issues for Farm Legislation

    WHS-0701-01, August 01, 2001

    Congress is considering new farm legislation to replace the expiring Federal Agriculture Improvement and Reform Act of 1996. As background for these deliberations, this report provides information on supply, demand, and prices in the U.S. wheat sector and examines alternative policy choices.

  • USDA Agricultural Baseline Projections to 2011

    WAOB-021, February 21, 2002

    This report provides long-run (10-year) baseline projections for the agricultural sector through 2011. Projections cover agricultural commodities, agricultural trade, and aggregate indicators of the sector, such as farm income and food prices.

  • Macroeconomic Factors Behind the Fall in Farm Interest Rates

    AIS-78-01, March 11, 2002

    Interest rates on agricultural loans are determined by factors primarily outside of the agriculture sector in national and international credit markets. This report discusses the macroeconomic factors behind the fall in agricultural interest rates in 2001 and the farm interest rate outlook for 2002. The author found that the sharp easing in monetary policy and lower business credit demand were primarily responsible for the fall in interest rates. The fall in interest rates was also aided in the second half of 2001 by a rise in the consumer savings rate, a moderate fall in short-term inflationary expectations, and a loosening of foreign monetary policies.

  • Income, Wealth, and the Economic Well-Being of Farm Households

    AER-812, July 01, 2002

    Agricultural policy is rooted in the 1930's notion that providing transfers of money to the farm sector translates into increased economic well-being of farm families. This report shows that neither change in income for the farm sector nor for any particular group of farm business can be presumed to reflect changes confronting farm households. Farm households draw income from various sources, including off-farm work, other businesses operated and, increasingly, nonfarm investments. Likewise, focus on a single indicator of well-being, such as income, overlooks other indicators such as the wealth held by the household and the level of consumption expenditures for health care, food, housing, and other items. Using an expanded definition of economic well-being, we show that farm households as a whole are better off than the average U.S. household, but that 6 percent remain economically disadvantaged.

  • Farm Payments: Decoupled Payments Increase Households' Well-Being, Not Production

    Amber Waves, February 03, 2003

    Although decoupled payments do not distort price incentives for producers, they can still alter production decisions because payments increase farm operators' income, and the expectation of fixed, future payments increases their wealth. Increased income and wealth from decoupled payments, as from any other source of income, has lasting effects on households' decisions about how much to spend, save, and work.

  • The Economic Well-Being of Farm Households

    Amber Waves, February 03, 2003

    Traditional assessments of the economic well-being of the farming population focused on farm income. Earnings from farming, however, are low for most farming households, and farm households have increasingly turned to nonfarm-related sources of income.

  • Farm Financial Picture Looks Promising for 2003

    Amber Waves, February 03, 2003

    The 2003 financial picture looks promising for most U.S. farmers and ranchers. Dairy farms, however, should continue to experience the tough conditions that prevailed during 2002 when milk prices reached a 20-year low.

  • On the Map

    Amber Waves, September 01, 2003

    Indicators: On the Map - September 2003

  • Agriculture Economy Improves in 2003

    Amber Waves, September 01, 2003

    The financial condition of U.S. farmers and other agricultural stakeholders is expected to improve in 2003. Net farm income, a measure of the sector's profitability, is forecast to be up $17 billion (49 percent) from the $35.6 billion earned in 2002 and about 10 percent above the 10-year average.

  • Assessing Farm Household Well-Being--Beyond Farmers and Farm Income

    Amber Waves, February 01, 2004

    ERS researchers use data from the USDA and the Federal Reserve to compare farm households and nonfarm households in terms of income and wealth. While farm income is traditionally used as a measure of farm household well-being, the analysis shows that other factors, such as wealth and off-farm income, are important determinants of well-being.