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Minnesota farm income ticks upward in 2019; uncertainty ahead

MINNEAPOLIS/ST. PAUL (04/02/20) — Minnesota farmers continued to struggle with low profitability in 2019. Median net farm income was up slightly from the previous year at $36,211, but was still historically low.

Each of the past five years has fallen in the bottom third of historical records tracked by University of Minnesota Extension and the Agricultural Centers of Excellence within Minnesota State when adjusted for inflation. 

“Farming as a business is far from profitable,” said Keith Olander of the Minnesota State Northern Agricultural Center of Excellence. “Minnesota farmers are in need of a good year.”  

Last year, 28 percent of farms lost money; 45 percent lost working capital; and 46 percent did not earn enough to cover scheduled debt payments.

“The average producer did a little better, but inside the numbers there was a lot of diversity,” said Dale Nordquist of the University of Minnesota’s Center for Farm Financial Management. “More than in most years, earnings depended on where…
Recent posts

COVID-19 Response: How the Families First and CARES Acts Affect Farm Businesses

by Megan Roberts, Extension educator, Ag Business Management
The Minnesota and federal government have recently passed several major economic stimulus acts related to the COVID-19 response. The laws have major financial implications for individuals and businesses, including farmers. The blog post briefly overviews major provisions of the recent federal laws. These laws are especially important to understand if your farm or agribusiness employs workers. Throughout this blog post links are provided to governmental websites that offer more detailed, up-to-date FAQs related to the quickly evolving interpretations of the laws.
Families First Act The Families First Coronavirus Response Act, H.R.6201, became law on March 18, 2020. Referred to as the Families First or FFCRA act, one of the provisions of this law and the subsequent temporary rules enacted by the Department of Labor, requires employers to offer paid sick leave for specific reasons related to COVID-19. This immediate requirement…

Women in Ag Network - March Feature

By Megan Roberts, Extension educator

Greetings from the Women in Ag Network. Over the winter, we took a hiatus from our newsletter and our Woman in Ag Feature. We had always planned to start back up in March, but in light of the major changes happening right now in the state, country, and world, it seemed extra important to connect and network with you all in a format that is still possible--online.  This month, we profile Rachel Gray in our Woman in Ag feature. Rachel is a beef rancher near Blackduck, MN and recently participated in the Annie's Project six-week agricultural risk management course hosted by Extension educator Heather Dufault.

WAGN: Tell us a little about your background and farm.
Rachel: I grew up on a dairy farm in Blackduck, Minnesota.  I was always involved with the farm in some way. I was the calf feeder as a young child, and then I graduated to hay hauler and eventually tractor driver. Growing up I knew I wanted to be involved in agriculture. I went to college…

State of Minnesota Extends Deadline for Tax Filing and Payments

By Rob Holcomb, EA, Extension Educator, Agricultural Business Management
On Monday, March 23, 2020, the Minnesota Department of Revenue announced that taxpayers filing their annual Minnesota Individual Income Tax return for tax year 2019 now have until Wednesday, July 15, 2020, to file and make their payments without any penalties or interest.
This extension follows what the Internal Revenue Service announced on March 20.Both the IRS and Revenue will accept federal and state 2019 individual income tax returns and payments through July 15, 2020, without assessing penalties or interest.
Minnesota is allowing additional time for making 2019 state individual income tax filings and payments to July 15, 2020, without any penalty and interest being applied. This includes estimated tax payments for individual income taxes due for the 2019 tax year.This grace period does not include estimated tax payments for individual income taxes due April 15, 2020, for the 2020 tax year.

IRS Postpones Due Dates for Tax Filings and Payments

by Rob Holcomb, EA, Extension Educator, Agricultural Business Management
On Friday, March 20, 2020, the Internal Revenue Service (IRS) issued Notice 2020-18.This notice restates and expands upon the relief provided in Notice 2020-17 (released March 18, 2020).
Notice 2020-17: This notice provides relief by postponing the due date for certain Federal income tax payments from April 15, 2020, until July 15, 2020.
Notice 2020-18: Due to the COVID-19 emergency, the due date for filing Federal income tax returns and making Federal income tax payments due April 15, 2020, is automatically postponed to July 15, 2020.There is no need to file extension forms.
Basically, Notice 2020-17 extended the due date of payments.Notice 2020-18 restated the extension of the deadline for tax payments AND extended the filing deadline.I’m listing both notices to try and avoid confusion.
There is no limitation on the amount of the payment that may be postponed. The relief provided is available solely with respect to Fe…

Farmers need to sign up for Farm Bill by March 16

The 2018 Farm Bill in available for sign up now until March 16, 2020. If a farmer fails to sign up by this date, their farms will be enrolled the same way they were in the previous 2014 Farm Bill. They will not receive a payment if one is due in 2019, if they do not sign up before the deadline. Farmers - be sure to sign up before the deadline.At this time, farmers are signing up for the first two years of the Farm Bill 2019 and 2020 and then they will be permitted each year thereafter for the last three years.
Farmers can chose between three choices:
ARC-CO: Agricultural Risk Coverage – County Revenue coveragebased on national price and county yield
PLC: Price Loss Coverage Price coveragebased only on national reference price
ARC-IC:Agricultural Risk Coverage – Individual Whole farm program, all crops planted by each FSA farm number must be ARC-IC and payment based on crops planted
To help evaluate the three choices, farmers should evaluate potential payment yields.
Over 50 Farm Bill meetings h…

Southwestern Minnesota farmland values decrease 0.2 percent in 2019

At the end of each year for the last twenty-five years, a survey has been conducted of farmland sales in fourteen southwestern Minnesota counties. The survey reports bare farm land sales to non-related parties for the first six months of each year. Land values had been steadily increasing until 2014. After reaching record high prices in 2013, the upward trend was broken as prices declined in 2014 and continued down through 2017. The trend changed to an increase in 2018 and remained constant in 2019. The summary report for this survey is available at the county extension offices in Chippewa, Cottonwood, Jackson, Lac qui Parle, Lincoln, Lyon, Martin, Murray, Nobles, Pipestone, Redwood, Rock, Watonwan and Yellow Medicine counties.This year, the decrease across the fourteen counties averaged 0.2%. SW Minnesota land prices peaked at $8,466 per acre and then declined through 2017 to $6,340 until increasing in 2018 to $6,589 and declined slightly to $6,576 in 2019.
The largest increase year t…