Revenues
Gross farm income includes cash receipts from the sale of farm products,
government payments arising from farm program participation, the value
of fuel, feed, fertilizer, see and other inputs consumed on the farm,
and the rental value of farmland and dwellings. Farmers often are able
to enhance their income by using futures and/or production contracts to
achieve a higher selling price than would be available if a crop was sold
at the time it was harvested. Often, production contracts require the
seller (the farmer) to achieve certain levels of quality and/or quantity
in order to qualify for a premium selling price. Many farms participate
in U.S. government farm programs in which income support payments are
made to farmers who raise program commodity crops and participate in applicable
conservation plans to reduce soil erosion and adhere to wetland protection
requirements currently in law.
The following table provides an estimate of the per-acre value of major
crops grown in the United States in the year 2000. Crop yields vary widely
across the country and overall production has an impact on market prices.
Table 2. Typical value of major agricultural
crops grown in the United States.
| Crop |
Typical Yield
(-/ acre) |
Typical Farm Price
($/-) |
Crop Value
($/acre) |
| Cotton |
650 pounds |
0.50/pound |
325.00 |
| Rice |
6,000 lb. |
5.00/hundredweight |
300.00 |
| Corn (grain) |
140 bushels |
2.00/bushel |
280.00 |
| Soybeans |
40 bu. |
4.75/bu. |
190.00 |
| Sorghum (grain) |
65 bu. |
1.85/bu. |
120.25 |
| Wheat |
40 bu. |
2.75/bu. |
110.00 |
Agricultural commodity prices have not kept pace with rising prices in
other segments of the economy, which has decimated the number of small
farms. Even though the per-acre value of most major crops is low, the
volume and value of crop production in the United States is staggering.
U.S. farm receipts exceed $200 billion per year. Of that total, approximately
10% comes to the farm in the form of government payments. Almost $50 billion
worth of agricultural products are exported each year, helping to offset
trade deficits in other sectors of the economy.
The agribusiness sector, which provides production agriculture with necessary
inputs and which adds value to farm products, continues to thrive. The
economic impact of agribusiness is huge. This food and fiber sector accounts
for about one-eighth of the U.S. gross domestic product ($1.26 trillion
in 2000) and employs just over one-sixth of the U.S. civilian labor force
(24.1 million workers).
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