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Kentucky ag boasts record cash receipts

By TIM THORNBERRY
Kentucky Correspondent

LOUISVILLE, Ky. — The agriculture industry continues to prove it is one of the state’s leading industries with news of yet another year of record cash receipts.

Last week the Kentucky Field Office of USDA’s National Agricultural Statistics Service (NASS) released the farm commodities 2008 state cash receipt report showing a total of $4.84 billion topping 2007’s $4.52 billion mark by seven percent.

According to the report, the sale of horses and stud fees led the way totaling $1.08 billion of 22 percent of the state’s total receipts but down $45.0 million from 2007.

Poultry sales made a respectful second place showing racking up $917.5 million, an increase of five percent over 2007 numbers. Broiler receipts accounted for $743.8 million of the poultry total.
One of the biggest surprises listed in the statement came by way of the corn crop which placed third with $653.0 million, up 30 percent from 2007 and surpassing cattle and calf numbers which came in fourth with $574.4 million, down 5 percent from 2007.

In fact crop cash receipts made up 40 percent of Kentucky’s total cash receipts, the report stated. Corn sales accounted for 34 percent of crop cash receipts. Soybeans made up 20 percent and tobacco made up 19 percent.

Leland Brown, director of the Kentucky NASS field office said while this is good news, is doesn’t indicate by any means that farmers are getting rich.

“You have to consider the input-cost side, just look at the dairy industry right now,” he said. “But we have been showing an increase over the last few years. It has been an improvement.”

Brown also said the numbers for this year are looking good as well with a lot of “optimism going on right now.”

As of the first of August, NASS projections showed increases in many agricultural sectors over 2008 including corn production in Kentucky, forecast at 169.5 million bushels, 11 percent above the 2008. Those estimates mirror the national forecast which stands at 12.8 billion bushels, up 5 percent from last year.

State soybean production looks to be ahead of 2007 as well. The NASS projects a total of 57.2 million bushels, an increase of 22 percent from last year. The agency notes the increase was brought about by an improved yield per acre and larger harvested acreage with yield estimates at 40 bushels per acre, up 6 bushels from the 2008 level.

Kentucky tobacco has shown a steady increase in total sales over the last three years according to the 2008 cash receipts information and the NASS projects that to continue this year at least in terms of burley production.

The latest state burley forecast indicates a total of 157.0 million pounds, up seven percent from the 2008 crop with yield estimates at 2,150 pounds per acre, up 50 pounds from last year. Harvested acreage estimates were up 3,000 acres over 2008 at 73,000.

Tobacco crop

As much of this year’s burley tobacco is currently being harvested, the overall condition of the crop is good to excellent despite scattered outbreaks of blue mold.

U.S. burley production is looking to increase over 2008 as well. The current forecast shows production at a forecasted 208.2 million pounds, three percent above last year with expected yields at 2,107 pounds per acre, up 40 pounds over 2008.

Kentucky’s dark tobacco crop, which has boosted overall numbers for the past few years looks to take a downturn in 2009 with the dark fire-cured tobacco forecast at 31.6 million pounds, down 17 percent from 2008 and dark air-cured tobacco production down 30 percent with a forecast of 14.5 million pounds.

NASS listed a reduction in the amount of dark tobacco on contract with tobacco companies as the cause for the decline.

Kentucky Agriculture Commissioner Richie Farmer is happy with the cash receipt report. The record numbers have come consistently under his watch since taking office in 2003. “Our producers keep raising the bar year after year,” Farmer said. “They had some difficulties to overcome last year – a very dry summer and declining commodity prices the second half of the year. Yet Kentucky’s farmers rose to the occasion and set another record while exceeding $4 billion for the fourth time in the past five years. I congratulate them on a job well done.”

Farmer has been instrumental in leading state agriculture into a more diversified arena through programs such as the Kentucky Proud marketing initiative and said state producers have the ability to make 2009 another banner year.

“Our farmers are tough and resilient. I know they can persevere through anything, and I challenge them to put their shoulders to the wheel and make 2009 even better than 2008.”

Tough and resilient they are, but the road to records has not been easy. Tommy Yankey, a county extension agent who works with farmers daily said while the news of record receipts is certainly positive, producers are still faced with high input costs and cash receipt numbers need to be high in order for producers to pocket any money.

“Equipment costs are high, labor is high and fertilizer prices have moderated, but they’ve not come down substantially though,” he said. “There’s not another industry out there that’s happy with a 2 percent rate of return and agriculture, year in and year out gets about a two percent rate of return.”

Yankey also noted those in the dairy industry as an example of how tough many have it in the agriculture sector. He said if the public could see producers’ balance sheets they would see that many are not in the black.

9/2/2009