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Regional Issues and Program Committee September 30, 2003

Regional Issues and Program Committee September 30, 2003 Larry D. Jones, Agricultural Economics. Farm Numbers, Kentucky 1940-2001. Thousands. Farm Numbers. Year. Source: Ky Ag. Statistics. WHAT IS A FARM?. What is a Farm?.

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Regional Issues and Program Committee September 30, 2003

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  1. Regional Issues and Program Committee September 30, 2003 Larry D. Jones, Agricultural Economics

  2. Farm Numbers, Kentucky1940-2001 Thousands Farm Numbers Year Source: Ky Ag. Statistics

  3. WHAT IS A FARM?

  4. What is a Farm? • Government says that a farm is a business that has $1000 gross sales of food and fiber per year • OR • Could sell $1000 annually

  5. Farm Cash Receipts—Kentucky1991-2002 Millions $ Total Livestock Crops Source: KY Agricultural Statistics

  6. Kentucky Crop Receipts, 2002 ($1.15 Billion) Millions $ Source: KY Ag. Statistics

  7. Kentucky Livestock Receipts, 2002($1.96 Billion) Source: KY Ag Statistics Millions $

  8. Net Cash Returns from Ag. SalesKY and U.S. Avg. Per Farm Dollars Per Farm Year Source: 1997 Census

  9. Government and Tobacco Payments as Percent of Net Farm Income in KY Percent Source: U.S.D.A, E.R.S

  10. KY Ag. Production-2002 CommodityNational Rank • Burley Tobacco 1 • Equine 1 • Other Hay 3 • Beef Cows 8 • Poultry 12 • Corn 15 • Soybeans 15 • Milk Cows 18 • Hogs 19 • Alfalfa Hay 27

  11. Type of Farm Organization Source: 1997 Agriculture Census

  12. 88% Caucasian 18,500 African-Amer. 10, 638 Native Amer. 8,731 Asian Amer. 27,717 Hispanic 7.6% Female Operated 98% Caucasian 523 African Amer. 123 Native Amer. 38 Asian Amer. 405 Hispanic 9% Female Operated U.S. vs. Kentucky Farmer Profile United States Kentucky Source: 1997 Ag. Census

  13. Kentucky Farms by Acres(75% of Farms Smaller Than National Avg) Source: Ag. Census

  14. Farms and Sales of Ag Products Percent Source: 1997 Ag. Census

  15. KY Farms by Sales(87% KY Farms Gross Less than $50,000) Source: 1997 Ag Census

  16. Sources of Income for Average Farm Household(Farm Income is 10% of Total) Source: USDA Ag. Resource Mgt. Study

  17. Average Farm and Off-Farm Income for Farm Households Size Dollars USDA Ag. Resource Mgt. Study

  18. Importance of Agriculture in Kentucky • Farming represents 3.2% of state’s economic activity and 6.2% of jobs • Forestry, inputs, and processing means added 9.5% of economic activity and 11.8% of jobs • Adding retailing means entire system equals 16.2% of state’s economy and 21.1% of the jobs Source: Godley and Jones IMPLAN, 2001

  19. Current Trends in Agriculture • Walmartization of production • Globalization rewards low cost managers • New trade agreements • Shifting role of government policy • Push for diversification, but…. • Widespread restructuring of agribusiness

  20. Current Trends in Agriculture • Products replace commodities • Product safety concerns will grow • Environmental factors influence location and concentration • Technology explosion accelerates • Information is “new” source of competitive advantage

  21. Implications for Markets • Evolution from commodities to components • Price change from food and feed to component pricing • Farm marketing-price takers to negotiators • Contracting expands • Markets become “thin” • Value of information

  22. SUMMARY • Basic underlying trends continuing • Think broadly of agriculture—it’s a system to produce and deliver consumer goods • Importance of healthy rural economies to farm families • Don’t underestimate the value of objective information in the current environment

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