The University of Minnesota Extension and the Minnesota State Colleges and Universities system issued their annual study of farm income Wednesday.

Across all types of Minnesota farms, the median net farm income was about $35,000, up from $27,000 in 2015.

The number in the report that struck me most was the more than 30 percent of our state's farmers in the red last year. It was also the third straight year of declining commodity prices.

I printed out a table from the report where you could analyze counties and picked Rice County and its neighbors. Among the six counties I chose from the FINBIN report from the University of Minnesota, Rice County did have the highest median net farm income of $27,604. Steele County was $26,457, Le Sueur County was $17,850, Goodhue County was $20,248, Dodge County was $17,850 and Dakota County was $23,406.

I spoke with Farm Director Jerry Groskreutz about the report and he wondered how it compared to the 1980s. Good question I said, and did some research.

According to an Adult Farm Business Management Report from 1985, in southeastern Minnesota the average farm income was $2,737. I couldn't locate a number indicating the number of farmers in the red back then. This was around the peak of the farm crisis. Eerily, some of the same factors were in existence. Namely consecutive years of declining commodity prices.

The most recent University of Minnesota Extension report is derived from information compiled by the Center for Farm Business Management using the FINBIN database, which can be queried at www.finbin.umn.edu.

The report pointed out the bumper crops across the corn belt affected prices.

"For the first time for this group of farms, the average corn yield topped 200 bushels per acre, up 19 percent from the 10-year average for these farms. But the average price received for corn declined by 9 percent. The story was similar for most other crop commodities."

By the way, the average corn yield in 1985 in southeastern Minnesota was 117.9 bushels and the average soybean yield was 30.9 bushels per acre. Soybean yields averaged 56 bushels per acre in 2016 compared to a 10-year average of 44 bushels.

You would think with lower crop prices meaning lower feed costs for livestock producers they might see a bump in income. Not the case. For the second consecutive year, prices for every major livestock commodity decreased.

The report states, "the median beef producer lost over $11,000 after losing almost $10,000 in 2015.

Dairy profits also declined in 2016. The median dairy farm earned $31,563, down from just over $45,000 in 2015. The average price received for milk decreased by 8 percent, from $17.95 per hundred pounds in 2015 to $16.57.

The report says, "with the average costs of production around $16.00, dairy producers netted less than 60 cents per hundred pounds of production, or $135 per cow."

The average dairy farm in Minnesota milked 180 cows. In 1985 the average dairy farm milked 55 cows.

Pork producers also lost money in 2016. The report stated, "the median hog farm lost just over $4,000 in 2016. Pork producers lost about 3 cents on every pound of pork sold."

The report goes on to say, "the average farm's balance sheet is still strong, but there are obvious signs of financial stress. Requests for participation in the Farmer Lender Mediation Program, where debtors and creditors negotiate with a mediator, have increased. Many farms have already restructured debt to lengthen terms and free up cash flow."

Silo- TSM Library