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Net farm income expected to decline 38 percent in 2009

WILLMAR -- According to the latest economic forecast from the U.S. Department of Agriculture, net farm income is expected to total $54 billion in 2009, down $33.2 billion or 38 percent from the $87.2 billion estimate for 2008.

The 2009 income forecast is $9 billion below the average net farm income of $63.2 billion earned in the previous 10 years.

In 2009, crop prices have continued to decline and prices for livestock animals and products have experienced sharp decreases.

With economic conditions deteriorating worldwide, demand for exports has weakened, with few options available to expand markets elsewhere. Therefore, declining demand in 2009 has forced farmers to accept prices that are lower than were expected earlier in the year.

On the input side, prices are also projected to be lower than in 2008, particularly for most manufactured inputs, feed and services, such as repairs or transportation.

Overall, the reduction in gross income will far exceed the reduction in production costs, leaving all net measures of income and output below the record levels established in 2008.

In 2009, average family farm household income is forecast to be $75,895, down 5.2 percent from 2008, and 8 percent below the five-year average for 2004-08.

In 2009, the average family farm is forecast to receive 7.6 percent of its household income from farm sources, with the rest from earned and unearned off-farm income.

USDA to buy additional $30Min pork products

The U.S. Department of Agriculture recently announced that it intends to purchase an additional $30 million in pork products for federal food and nutrition assistance programs during the 2009 fiscal year.

Altogether, USDA has purchased approximately $151 million in pork products for food and nutrition assistance programs this year.

The purchases are also being made to assist our nation's pork producers, who are currently struggling financially due to extremely depressed market conditions.

A survey of potential suppliers will be conducted by USDA to seek the lowest overall cost by publicly inviting bids and awarding contracts.

The pork products to be purchased must meet specific grade requirements and must be USDA-certified to ensure quality. In addition, USDA will only purchase pork products from hogs grown in the United States.

USDA accepting public comments regarding CRP

The U.S. Department of Agriculture is asking the public for comments or suggestions regarding the administration of the Conservation Reserve Program. In addition to accepting written comments, USDA has scheduled nine public meetings to receive oral comments from the public.

Topics to be discussed at the meeting include provisions dealing with cropping history requirements, crop rotation practices, contract incentives, program enrollment terms and the current Conservation Reserve Program enrollment authority of 32 million acres.

The meetings will be from Sept. 15 through Oct. 8. One such meeting will be from 5 to 7 p.m. Sept. 21 at the AmericInn Lodge and Suites in Moorhead.

The comments received from the public will assist USDA decision makers with an analysis of the environmental benefits and potential impacts associated with implementing various changes to the Conservation Reserve Program that are consistent with the intentions of the 2008 farm bill.

Written public comments are due Oct. 19. Comments can e-mailed to:

For those wanting to submit comments by mail, the address is: CRP SEIS, c/o TEC Inc., 8 San Jose Dr., Suite 3-B, Newport News, VA 23606. Comments can also be faxed to: 757-594-1469.

Dairy producersto receive July MILC payments

Due to dramatically reduced milk prices during the month of July, dairy producers will qualify for payments under the U.S. Department of Agriculture's Milk Income Loss Contract program.

Initially authorized by the 2002 farm bill, and then reauthorized under the 2008 farm bill, the program provides monthly financial assistance whenever the Boston Class I milk price falls below the payment trigger price of $16.94 per hundredweight. Dairy producers then qualify for a payment rate equal to 45 percent of the price difference.

During the month of July, the Boston Class I milk price averaged $13.15 per hundredweight or $3.43 below the $16.94 target price. Therefore, dairy producers qualify for a payment of $1.54 per hundredweight for milk produced and sold during the month of July.

According to USDA, feeding costs for the month of July were not high enough to warrant an upward adjustment to the $16.94 target price.

Nelson is executive director of the USDA Farm Service Agency in Kandiyohi County.