MINNEAPOLIS (AP) — Rising commodity prices, good weather and two rounds of government aid in 2020 have led Minnesota farmers to their most profitable year in nearly a decade.
A report from the University of Minnesota Extension and Minnesota State Centers of Agricultural Excellence pegs median net farm income at nearly $107,000 last year after seven years of low profitability.
In contrast, from 2013 to 2019, the state’s median annual farm profit hovered between about $27,000 and $42,700.
Economists say 2020 has provided “a sigh of relief”, although they are pricing their valuation due to volatility in agriculture, the Star Tribune reported.
Without government assistance, Minnesota farmers would have experienced an eighth straight year of low profitability, said Pauline Van Nurden of the Center for Farm Financial Management at the University of Minnesota.
“Farms had a successful year last year – a profitable year – given all the challenges of the pandemic,” Van Nurden said. “It was the first year in eight years that they really saw big profits. The slowdown has been quite long so far.
Government assistance played a key role in farm profits last year, accounting for 12% of the average producer’s gross farm income.
“Farmers would always prefer to get their income from the marketplace rather than the government,” said Kevin Paap, president of the Minnesota Farm Bureau. “But that was the lifeline for a lot of us to continue early (in the year).”
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