BOISE — Idaho farmers and ranchers earned record profits last year, despite disruptions related to the coronavirus pandemic.
University of Idaho economist Garth Taylor shared the good news with the Senate Agricultural Affairs Committee on Tuesday.
“Net farm income (in 2020) broke the all-time record — in a COVID year,” Taylor said. “It was up 38 percent, to $3.5 billion.”
Net income reflects the difference between total revenues and total expenses. Revenues were boosted by a record $646 million in government farm payments, Taylor said. That’s about four times higher than the 10-year average, largely because of nearly $500 million in federal payments through the Coronavirus Food Assistance Program.
Nevertheless, government payments alone didn’t account for the record results.
“We would have broken records without the farm income payments,” Taylor said. “That’s the big news for Idaho. We’re breaking records without government payments. We’ll take the money, but we don’t need it.”
It hardly looked to be a record-setting year last spring, when the coronavirus pandemic disrupted supply chains across the nation.
“This was a demand-side shift,” Taylor said. “Restaurants were shut down, so people started buying food for home consumption. The amount of food didn’t necessarily change, but it shifted to different sources, different types and different cuts of meat. At one point, 40 percent of meat workers were laid off.”
By the fall, however, farmers were seeing higher prices and fabulous yields for a variety of crops. Sugar beet producers, for example, reported average yields of 40 tons per acre, with sugar content of about 20 percent. That resulted in a 29 percent increase in sugar beet revenues.
Similarly, potatoes — Idaho’s largest cash crop — brought in about $1.1 billion in revenue. That was a 13 percent increase from 2019, despite wild price swings that saw farmers dumping potatoes early on in the pandemic and earning record prices just weeks later.
Despite the high crop prices, Taylor said livestock and dairy are the most important components of Idaho’s agricultural industry. Together, they account for about 60 percent of gross farm receipts. When hay and silage are added in, it’s closer to 75 percent.
“We’re a livestock state,” he said. “That’s what drives agriculture in Idaho.”
And agriculture, in turn, is driving the statewide economy.
In inflation-adjusted dollars, Taylor said, Idaho’s total gross domestic product (GDP) has just about doubled since 1997. Agribusiness, by contrast, has more than tripled.
“So Idaho agriculture — farming, grandma and grandpa on the tractor — has grown well over than the state’s economy,” he said. “Ag is growing faster than the state. It isn’t some stodgy backwater. It’s an engine for growth in the state GDP.”
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