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~[) t(E 1 I l.Bi .. J er 1::1 Federal Reserve Bank of Ch" MAR_,:l~:;t\_gricult ural REALIZED NET INCOME per farm reached a record Ma<eh 18,1966 high of $4,182 in 1965, about 12 per cent above the preceding year, according to recent U. S. Department of Agriculture estimates. While total net farm income rose 9 per cent, the number of farm operators declined in all states, hence, helping to boost income per farm. Total realized net farm income rose to an estimated $14.1 billion from $12.9 billion in 1964 and was at the highest level since 1952. The sharp rise stemmed, of course, from larger cash receipts primarily from livestock marketings and a further increase in Government payments. Farmers' sales of livestock and livestock products increased about $2 billion last year to an estimated $21.8 billion, primarily reflecting sharply higher prices. The volume of livestock marketings was about the same as a year earlier. Prices received by farmers for hogs averaged 40 per cent above the 1964 level, and, although the number of hogs slaughtered dropped about 10 per cent, cash receipts rose about $700 million. Similarly, cattle prices averaged about 11 per cent higher, and this, combined with a small increase in slaughter, led to an increase of more than $1 billion in cash receipts from cattle and calves. Sales of crops by farmers showed little change from a year earlier as slightly lower prices offset a small increase in the volume of marketings. Increased Government payments under the feed grain, wheat and cotton programs helped bolster many crop producers' income. Government payments under both the wheat and feed grain programs were well above year-earlier levels:, reflecting greater participation by farmers and some changes in the programs. Payments under the feed grain program rose 20 per cent from the 1964 level to about $1.4 billion, and payments under the wheat program increased from $439 million to about $532 million. Government Payments Contribute to Higher Income 1964 1965 -IJLetter Number 848 Cash receipts were higher than a year earlier in each of the District states-except Michigan which was unchanged-primarily reflecting the relative importance of livestock in the District. Sales of livestock and livestock products during 1966 accounted for about two-thirds of total cash receipts in the District compared to slightly over half for the nation. Slightly higher prices for major midwestern crops also helped bolster farm income in the District. Incomes Increase Sharply Cash receipts from marketings Increase from go 1965 (m"i'fj"i';;-ns) ~ p Illinois Indiana Iowa Michigan Wisconsin District states United States $2,406 1,296 2,950 791 1,221 8,664 38,930 9 8 10 6 8 6 Rea I ized net income eer farm Increase from .!..ill_ $5,979 4,171 5,665 2,848 3,762 4,484 4,182 (~=~re:~~) 19 21 19 8 19 18 12 Farm income in the Midwest is likely to increase somewhat further during the current year. This is indicated by the continued high level of farm prices and the larger inventories of crops carried over from last year. Prices received by farmers during February advanced 3 per cent from the preceding month and were 14 per cent above the year-ago level. Corn in farm storage in the District states as of January 1 was 13 per cent above the year-earlier level and soybeans in storage were about 40 per cent higher. --(million dollars) Indiana II linois Iowa Michigan Wisconsin United States 78 131 226 46 48 2,169 100 140 229 55 52 2,450 In the Seventh Federal Reserve District states, income gains outpaced those for the nation by a wide margin. Income per farm was at a record high in each of the District states with four of the five states showing gains of 19 per cent or more from the preceding year. The volume of livestock and livestock products marketed during 1966 is expected to decline somewhat. But both cattle and hog prices are expected to continue strong although some decline from present levels is likely during the latter part of the year as supplies increase. The large inventories on farms are expected to contribute to an increased volume of crop marketings during 1966, and marketings could be boosted further during the second half of the year as a result of an anticipated increase in acreage of feed grains and wheat. Roby L. Sloan Agricultural Economist I 1 FARM RUSINESS CONDITIONS ANNUAL SUMMARY Calendar Years Items 1940 1950 1955 1960 1964 PlllCES: Prir.f's received hy farmers ••••••• (19S7-59=I00/ raid by farmers •••••••••••••• (19S7-S9=1001 P;irity price ralfo ••••••••••••• (l910-1,:c1001 •••••• Wholesale, all commodities ••••••• (1957-59•1001 •••••• P;iid hy consumers •••••••••••• (19s1.s9.,1001 •••••• Wheat, No. 2 red winter, Chicago ••• (d .. r. p•r bu./ • • • • • • • Corn, No, 2 yellow, Chicago •••••• (do/. per bu.I • • • • • • • Oats, No. 2 white, Chicago • •••• •.(dot. per bu.I • • • • • • • Snyhcans, No. I yellow, Chicago ••• (d.,/. P'" bu./ • • • • • • • Hogs, bMrows and gilts, Chicago ••• (do/. per cwt.I • • • • • • • Or.cf steers, choice grade, Chicago •• (d<>I. p•r cwt.l • • • • • • • Milk, wholesale' U. S. • •••••••• (do/. p•r cwt.I • • • • • • • Butterfat, local market, U.S. • •••• (d .. 1. r~r tb.J •••••••• Chickens, local markets, U. S. • ••• (d.,r. per 11,./ • • • • • • • • Eggs, local markets, U. s. . ..•.•. (d .. l. per do,.) ••••••• Milk COWS, U. S. • • • • • • • • • • •••(do/. per 1,,-od/ • • • • • • • F;nm l;ibrr, U. s., without board 2 •••(do/. per wk.I • • • • • • • Factory labor, u. s.•.......... (do/. """'"d per wk.) ••• 42 42 81 43 49 0.95 0.63 0.39 0.95 5.80 ll.86 1.82 0.28 0.14 0.18 61 27.50 24.96 107 88 101 87 84 2.22 1.50 0.85 2.74 18.39 29.68 3.95 0.62 0.25 0.37 198 31.00 58.32 96 94 84 93 93 2.12 1.41 0.73 2.50 15.16 23.16 4.04 0.58 0.24 o.4o 146 38.00 75.70 98 102 80 101 103 1.99 1.16 0.73 2.17 16.05 26.24 4.21 0.60 0.16 0.36 223 45.75 89. ·72 98 107 76 101 108 1.76 1.25 0.69 2.68 15.54 23.12 4.18 0.59 0.14 0.33 208 49,50 103,38 PRODUCTION: lnr1ustrial • • • • • • • • • • • • • • • • • (1957-S9el00/ • • • • • • • Fmm markctingsJ ••••••••••••• (1957-59=1001 •••••• 44 64 75 83 97 96 109 107 132 79 229 310 401 495 8.4 4.6 720 28.5 14.o 2,479 29.6 11.8 2,529 34 .o 12.0 3,044 36,9 12.9 3,727 4,182 250 884 960 1,255 1,270 1,510 6.7 56.2 5.7 61.0 96 98 97 101 110 n6 108 113 84 85 ll2 llO 177 202 193 222 INCOME: Total personal ••••••••••••• o(b/1. ofdol.) •••••••• Farm: Cash receipts from marketings ••• (btl. of dot.I •••••••• Farm operators' net, Iola I •••••• <bl 1. of do,. I ••• , •••• Farm operators' net, per farm •••• (do/./ •• • • • • • • . • • • Farmer's income, per capita,• from all sources • • • • • • • • • • • (dollorsl • • • • • • • • EMPLOYMENT: e • • (mil.I a ea. e Farm ••• e e • e Nonagricultural ............... (mll.l 9 O •. • a a. a a• a e e e • FINANCIAL (D/sfr/ct Membor Banks): Demand deposits: Agricultural banks ••••••••••• <1957-59 "'"· Nonagricultural banks ••••••••• <1957-59 mo. T i111c deposits: Agricultural banks ••••••••••• (1957--59 mo. Nonagricultural banks ••••••••• 11957••59 mo. l P,ellmlttory 2 3 4 E•tlmate• avg.= 1001 ov 9 .=1001 .= 1001 av 9 av 9 .=1001 estimates. hosed on Revlsed series. R•vl ■ ttJ ♦ •••••••••••• •arh1•. monthly wage rotes for year• prior to 1948. 9.5 37.9 118 102 110 77 103 110 1.55 1.30 o. 74 2.83 21.91 26.19 4.25 0.60 0.14 0.33 211 51.50 107.27 4 143 ll8 38.9 14.1 4.6 67.6
@FedFRASER