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AGRICULTURE: N.D. crop value hits record

The value of North Dakota's crops last year was up 75 percent over 2006, setting a record and providing another measurement of how remarkable this past year has been for the state's farmers.

The value of North Dakota's crops last year was up 75 percent over 2006, setting a record and providing another measurement of how remarkable this past year has been for the state's farmers.

The U.S. Department of Agriculture reported Friday that overall 2007 crop production in the state was valued at $6.46 billion, up 75 percent from 2006, according to The Associated Press.

And that's not even counting sugar beets, a big cash crop for many in the Red River Valley.

The crop values are calculated by multiplying production by the actual prices farmers received for their crops, based on a large USDA survey each month.

Five times state's budget

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To illustrate the impact of farming on the state, last year's crop values amount to about $2,656 per person, or five times the state's general fund budget this year. The state's crops last year were worth about twice or more what the state's crude oil harvest was worth.

Another way to look at the numbers: There are about 30,000 farmers in North Dakota but only about 10,000 are of a commercial size - that is, providing a full-time living - based on acreage and sales, according to USDA figures. And those 10,000 grow the majority of all crops.

That means that, based on rough calculating, typical farmers in eastern North Dakota garnered $500,000 to $1 million from last year's crops.

The hard red spring wheat crop had the most value, at a record $1.7 billion, up about 70 percent from 2006. North Dakota farmers grew 234 million bushels of spring wheat, up 10 percent from 2006, and the average price received by farmers over the marketing year was a record $7.30 a bushel, up 63 percent from the 2006 marketing year average price of $4.49 a bushel.

Those figures highlight the ferment right now in the spring wheat markets, as Minneapolis futures for March hit another record Friday, closing at $19.35 a bushel, up 82 cents on the day.

Wheat at area grain elevators sold as high as $20 a week ago, according to at least two elevator managers. Prices have fallen slightly since then. According to an Agweek magazine survey of about 30 elevators in eastern North Dakota and northwest Minnesota, spring wheat prices posted Friday averaged $18.13 a bushel. The highest posted bid seen in the survey was $18.80 at the State Mill and Elevator in Grand Forks.

Of course, there is very little spring wheat still in farmers' bins, elevator managers say. So, not many farmers get those top prices.

While "new crop" prices are much lower, farmers still can contract now to sell next year's crop for about $10 a bushel, about triple the long-time average price, based on the Agweek survey. "Very good demand, both internationally and domestically, is driving that," Jim Peterson, marketing director for the North Dakota Wheat Commission told the AP on Friday.

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That demand comes from a combination of bad crops in several key wheat-growing countries the past two years; growing wealth in countries such as China and India leading to better diets that include wheat, soybeans and corn; and a low-valued U.S. dollar that makes American crops and food better buys in the world market.

Some of the highest prices earlier last year were seen in durum wheat, which is used to make pasta. North Dakota raises most of the nation's durum, and prices were offered Friday at more than $22 a bushel for it at area elevators. Last year's durum crop was valued at $482 million, up 234 percent over 2006, USDA said.

As high as that was, it was not a record. In 1975, the durum crop's value was $488 million, when the state's farmers grew 105 million bushels of it. Last year, farmers produced only 44 million bushels, but it was worth much more.

The average price paid for durum last year was $11 a bushel, compared with $4.65 in 1975, USDA reported, according to the AP. The comparisons to 1975 prices are not adjusted for inflation.

Corn value lowerAlthough corn production outgrew spring wheat last year in North Dakota for the first time, the total value of the corn crop was much lower, at $1 billion. But that was a record by far for corn in the state.

"We had an excellent production year across the state," Larimore farmer Jay Nissen, president of the North Dakota Corn Growers Association, said. "Then, you take in an above-average price and you've got a mark that's really good for producers."

Tom Lilja, a former Larimore farmer and executive director of the Corn Growers Association, said tight wheat supplies nationwide are more of a factor in higher corn prices than is demand from the ethanol industry, which uses corn to make fuel.

"Corn futures have really had to keep pace, because otherwise everybody is going to plant wheat and nobody is going to plant corn," he said.

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The state's soybean crop also set a value record last year, at $1 billion. Acres planted to soybeans have increased the past decade or more. Last year's prices also reached near-record levels.

That market, too, remains hot. Friday, soybean futures prices hit a high of more than $14 a bushel in Chicago, a record. Prices offered Friday at local elevators ranged from about $11.70 to $12.70 a bushel for last year's soybeans.

Traill County has seen the biggest increase in soybean acreage in recent years. Two elevator spokesmen in the county said the record prices Friday didn't spark big selling by farmers. Because prices have been near these levels for some time, the record hit Friday didn't cause much selling, they said. But many farmers remain bullish and think prices will rise more, so they are hanging on to their beans, said one elevator spokesman. And while most of the soybean crop has been sold, there are not insignificant stocks left in farmers' bins, they said.

Potatoes decreasePotatoes are the only crop that saw a decrease in value last year in North Dakota, with a 6 percent drop to $156 million, USDA said. Competition for acres from corn and other crops the past year contributed to less potato plantings, part of a long-term trend.

Just last month, RDO Foods in Grand Forks, which makes processed potato products, announced it was closing this spring, putting more than 100 people out of work. Experts told the Herald that the current high prices for 2008 crops of all kinds in the state is pushing farmers to drop potatoes - a high cost and higher-risk crop - in favor of other crops.

The value of all types of sunflower production in North Dakota was estimated at $318 million, double the previous year's value. The state's barley crop was valued at $307 million, up 138 percent from the previous year.

The dry edible pea crop set a record, too, in value at $110 million, USDA said.

Figures for the value of the sugar beet crop last year aren't yet available. But a year ago, the 2006 beet crop was worth about $225 million.

From prices and production reported already by the two farmer-owned cooperatives that grow sugar in North Dakota, the 2007 beet crop should be worth about that much.

The total value of 2007 crops nationwide was pegged by the USDA at $132 billion, up 40 percent from $94 billion in 2006.

Herald Staff Writer Stephen J. Lee and the Associated Press contributed to this report.

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