State’s crop estimated at nearly $6.6 billion for 2008

BISMARCK — The value of North Dakota crop production last year nearly equaled the record set in 2007, despite tumbling commodity prices toward the end of 2008.

The Agriculture Department estimated the total value of all crops in the state last year at $6.59 billion, down just 1 percent from the record 2007 total of $6.65 billion.

The small drop is not surprising given that some farmers were able to contract early last year for high prices before the commodity markets went into a nosedive, said Dwight Aakre, a farm management specialist with the North Dakota State University Extension Service.

North Dakota farmers last year also produced 5 percent more bushels of two major crops — spring wheat and corn. Corn production in the state set a record.

That helped the value of the two crops. Though both declined over the year, the drops were not steep — spring wheat decreased from the 2007 record by $18.5 million, to $1.72 billion; and corn dropped by $8.8 million, to $1.1 billion. Together, the drops amounted to about 1 percent.

“Production-wise, the spring wheat crop helped temper some of the price drop,” said Jim Peterson, marketing director for the North Dakota Wheat Commission.

Peterson also said that while wheat prices were around $20 a bushel in the spring of 2007, the average spring wheat price over that marketing year was less than half that amount.

“That’s why the year-to-year difference isn’t so dramatic,” he said.

A 39 percent jump in the value of the North Dakota barley crop also pushed up the overall 2008 crop production value. Barley was valued at a record $423 million.

Barley production in the state increased 11 percent from 2007 and was nearly double the 2006 production, when low prices soured many farmers on the crop.

North Dakota is the nation’s largest barley producing state, typically accounting for more than a third of the total U.S. crop. Farmers and industry officials attribute the 2008 production increase to higher prices that led to more acres, and to ideal growing conditions in the eastern part of the state.

The Agriculture Department computes the value of production for each crop by multiplying the average price over the marketing year by the production.

The record production value set in 2007 in North Dakota was largely the result of market prices that skyrocketed because of tight global supplies for most commodities, Aakre said. Farmers worldwide then grew more crops last year, pushing up stocks and lowering prices.

“The (poor) overall economic health of the U.S. and overseas also was a big factor” in price drops last year, Aakre said.

Still, the high commodity prices of 2007 carried over into the first half of 2008. “It was only the last four, five months that market prices started tumbling,” Aakre said.

In North Dakota, four crops besides barley increased in value over the year: dry edible beans, winter wheat, canola and hay. All other crops, including durum wheat, soybeans, sunflowers and potatoes, saw declines in value. Sugar beet production values were not yet available for 2008.

Nationwide, the total value of 2007 crop production was estimated at $134 billion, down from $136 billion in 2006, the Agriculture Department said.

———

On the Net:

N.D. Agricultural Statistics Service: http://www.nass.usda.gov/Statistics—by—State/North—Dakota/index.asp

Tags: news, farm, crop, value