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So you want to be a farmer? Have 540 acres to farm, $120K to support family?

Cory Erickson of Raymond harvests one of his corn fields Sept. 14, 2012, in rural Kerkhoven. A recent University of Minnesota Extension paper found that the average return of $280.36 per acre of corn means a farmer needs to grow 428 acres to support a family of three persons. Tribune file photo by Ron Adams

Agriculture is big business in Minnesota, there is no question about that fact. The production, processing, marketing and distribution of agricultural products account for about $16 billion of state revenue, according to statistics.

The state is the nation’s fourth leading producer of crops and eighth leading producer of livestock, and employment in agriculture is second only to manufacturing in the state. However, only 19 percent of the more than 40,000 agricultural jobs are at the farm or production level, according to data from the University of Minnesota.

Data from real farm families shows that the cost of living for those involved in production agriculture requires tilling significant land acreage and tending large herds of animals to pay the costs for an average family.

According to a University of Minnesota Extension paper written by Extension Educator Gary Hachfeld, data from the 2007 to 2011 production years shows that a farmer raising corn and soybeans needs to grow 540 acres of the two crops to pay the average family living expenses.

The paper was issued in April 2011.

Hachfeld’s paper outlines that in 2011, 43 of the 114 farm families in the Extension Southwest Farm Business Management Association kept household and personal expense records. Those records showed an average living expense of $119,913 for a household of three persons. The family expenses include food, clothing, medical, donations, education costs, recreation, utilities, gifts, child care, upkeep of the house, non-farm vehicles, investments, savings, life insurance premiums and other personal costs.

Based on that family living cost, Hachfeld used the association’s data on the average return over the five-year period, on various types of farm operations. The net returns are the dollars remaining after all the farm expenses are paid, and did not include a charge for labor and management and were for cash-rented land. The paper also figures that all family living income would come from the farm operations and not from off-farm income.

Hachfeld found that the average return of $280.36 per acre of corn means a farmer needs to grow 428 acres to support the family.

If the farmer only grew soybeans, at an average return of $164.64, he’d need to grow 728 acres of the crop. In a more typical situation of half corn and half soybeans, the farmer needs 270 acres of corn and 270 acres of soybeans, a total of 540 to support the family.

The contract hog finisher made $3.86 per hog during the 2007-2011 period, requiring feeding 31,066 head per year to support the family. Correspondingly, pork producers feeding hogs from weaning to finish lost $3.38 per head during the period.

The beef producer finishing calves made $0.81 per head and would need to feed 148,040 head a year to pay the family’s bills.

A cow-calf producer would need a herd of 6,008 cows, at an average return of $19.96 per head, to support his family.

Finally, the dairy producer would need a herd of 169 cows, at an average return of $710.40, to support his family.

The Southwest Farm Business Management Association includes the counties in the southwest corner of the state, from Yellow Medicine and Renville counties south and from Faribault and Nicollet counties west to the South Dakota and Iowa borders.

--Gretchen Schlosser

Gretchen Schlosser

Gretchen Schlosser is the public safety reporter, and writes about agriculture occasionally, for the West Central Tribune. She's been with the Tribune since 2006 and has 17 years of experience working in news, media and communications. 

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