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AFPC Briefing Paper 04-1
January 2004
Representative Farms EconomicOutlook for the January 2004
FAPRI/AFPC Baseline
Department of Agricultural EconomicsDepartment of Agricultural EconomicsTexas Agricultural Experiment StationTexas Agricultural Experiment StationTexas Cooperative ExtensionTexas Cooperative ExtensionTexas A&M UniversityTexas A&M University
College Station, Texas 77843College Station, Texas 77843--21242124Telephone: (979) 845Telephone: (979) 845--59135913
Fax: (979) 845Fax: (979) 845--31403140http://www.afpc.tamu.eduhttp://www.afpc.tamu.edu
Agricultural & Food Policy Centerat Texas A&M University
AFPC Briefing Series
The briefing series is designed to facilitate presentation by AFPC related torequests for specific policy impact analyses. The materials included in thispackage are intended only as visual support for an oral presentation. The user iscautioned against drawing extraneous conclusions from the material. In mostAFPC welcomes comments and discussions of these results and theirimplications. Address such comments to:
Agricultural and Food Policy CenterDepartment of Agricultural Economics2124 TAMUSTexas A&M UniversityCollege Station, TX 77843-2124
or call 979-845-5913.
REPRESENTATIVE FARMS ECONOMICOUTLOOK FOR THE JANUARY 2004
FAPRI/AFPC BASELINE
AFPC Briefing Paper 04-1
James W. RichardsonJoe L. Outlaw
David P. AndersonJ. Marc Raulston
Brian HerbstJames D. Sartwelle, IIIRobert B. Schwart, Jr.
Keith SchumannPaul Feldman
Steven L. Klose
REPRESENTATIVE FARMS ECONOMIC OUTLOOK FOR THEJANUARY 2004 FAPRI/AFPC BASELINE
The farm level economic impacts of the Farm Security and Rural Investment Act of 2002 on representative crop and livestock operations are projected in this report. The analysis was conducted over the 2001-2008 planning horizon using FLIPSIM, AFPC’s whole farm simulation model. Data to simulate farming operations in the nation’s major production regions came from two sources:
# Producer panel cooperation to develop economic information to describe and simulate representative crop, livestock, and dairy farms, and
# Projected prices, policy variables, and input inflation rates from the Food and Agricultural Policy Research Institute (FAPRI) January 2004 Baseline.
The FLIPSIM policy simulation model incorporates the historical risk faced by farmers for prices and production. This report presents the results of the January 2004 Baseline in a risk context using selected simulated probabilities and ranges for annual net cash farm income values. The probability of a farm experiencing annual cash flow deficits and the probability of a farm losing real net worth are included as indicators of the cash flow and equity risks facing farms through the year 2008.
Definitions of Variables in the Summary Tables
# Overall Financial Position, 2004-2008 -- As a means of summarizing the representativefarms’ economic efficiency, liquidity, and solvency position AFPC classifies each farm as being in either a good (green), marginal (yellow) or poor (red) position. AFPC assumes a farm is in a good financial position when it has less than a 25 percent chance each of a cash flow deficit and a 25 percent chance of losing real net worth. If the probabilities of these events are between 25 and 50 percent the farm is classified as marginal. A probability greater than 50 percent places the farm in a poor financial position.
# Receipts -- 2004-2008 average of cash receipts from all sources, including market sales,CCP and direct payments, loan deficiency payments, crop insurance indemnities, andother farm related receipts.
# Payments -- 2004-2008 average of annual counter cyclical payments, direct payments,and marketing loan gains/LDP for crops and the milk program payment for dairy farms.
# NCFI -- 2004-2008 average net cash farm income equals average total receipts minus average total cash expenses.
# Reserves 2008 -- equals total cash on hand at the end of year 2008. Ending cash equals beginning cash reserves plus net cash farm income and interest earned on cash reserves less principal payments, federal taxes (income and self employment), state income taxes, family living withdrawals, and actual machinery replacement costs (not depreciation).
# Nominal Net Worth -- equity equals total assets including land minus total debt from allsources and is reported at the end of 2008.
# CRNW -- annualized percentage change in the operator’s net worth from January 1, 2004, through December 31, 2008, after adjusting for inflation.
IA
MONMOC
TNSC
TXNP
TXHG
INNE
TXWG
Characteristics of Panel Farms Producing Feed Grains.
IAG1350IAG2750IAG4200NEG1960NEG4300MOCG1700MOCG3630MONG1850ING1000ING2200TXNP1750TXNP7000TXHG2000TXWG1400TNG900TNG2400SCG1500SCG3500
Cropland
(acres)
1,3502,7504,2001,9604,3001,7003,6301,8501,0002,2001,7507,0002,0001,400
9002,4001,5003,500
Assets
($1,000)
1,092.002,012.004,167.002,218.005,069.002,961.004,810.003,412.001,530.004,387.00
486.002,931.00
521.00585.00618.00
2,109.00874.00
4,071.00
Debt/Asset
(ratio)
0.120.170.130.100.150.130.150.140.100.140.160.140.180.130.240.160.200.15
Gross Receipts
($1,000)
443.10764.00
1,483.00957.00
1,938.40399.80948.80642.70342.00783.90546.00
1,815.80379.00269.20249.60743.40489.80
1,301.20
Feed Grains
(acres)
6751,3752,1001,6462,666
8251,650
900500
1,100880
4,2801,3501,150
4501,080
8461,840
• Overall, 8 feed grain farms are characterized as good, 9 are moderate and one is in poor condition.
• Only three of eighteen farms will be under cash flow stress with only one in poor condition in terms of maintaining real wealth.
Economic Viability of Representative Farms over the 2004-2008 Period
Viability is classified as good (green), moderate (yellow), and poor (red) based on the probabilities:
P(Cash Flow Deficit) is the probability that the farm will have a cash flow deficit. Reported values represent the probabilities for 2004 and 2008.P(Real Net Worth Decline) is the probability that the farm will have a loss in real net worth relative to the beginning net worth. Reported values represent the probabilities for losing real net worth from 2001 to 2003 and from 2001 to 2008.
1
2
3
< 25 > 5026 - 50
1 Receipts are average annual total cash receipts including government payments, 2004-2008 ($1,000)2 Payments are average annual total government payments, 2004-2008 ($1,000)3 NCFI are average annual net cash farm income, 2004-2008 ($1,000)4 Reserve 2008 are average ending cash reserves, 2008 ($1,000)5 Net Worth 2008 are average nominal ending net worth, 2008 ($1,000)6 CRNW are average percentage in real net worth over 2004-2008 period, (%)
1-11-19NEG43001-11-1NEG1960
1-2454-97ING22001-5958-99ING1000
1-529-23TXWG1400
1-116-23SCG35001-1245-37SCG15001-515-38TNG24001-123-8TNG900
1-927-37TXHG20001-226-33TXNP7000
1-1638-48TXNP1750
1-639-53MONG18501-19-7MOCG36301-17-20MOCG1700
1-113-28IAG42001-118-11IAG2750
1-1014-33IAG13502004-20082004-20088/9/1
P(Real Net Worth Declines)P(Cash Flow Deficit) Farm Name
Implications of the January 2004 FAPRI Baseline on the Economic Viability of Representative Farms Primarily Producing Feed Grains and Oilseeds.
IAG1350IAG2750IAG4200NEG1960NEG4300MOCG1700MOCG3630MONG1850ING1000ING2200TXNP1750TXNP7000TXHG2000TXWG1400TNG900TNG2400SCG1500SCG3500
Receipts
($1,000)447.39769.80
1,495.261,013.231,874.01
479.93881.94655.67305.26714.35627.16
2,031.17420.86293.21254.86743.74519.15
1,376.13
Payments
($1,000)51.1388.20
176.03100.03177.76
52.2595.4454.1233.8781.6062.59
212.7758.4946.1127.3678.9591.14
203.26
NCFI
($1,000)114.98284.89433.80354.13482.48224.40440.46196.59
48.31127.55137.08458.44
93.6284.2177.78
203.4498.87
386.84
Reserve 2008
($1,000)209.67632.38949.91
1,302.461,201.26
369.33908.60
97.75(127.88)(190.59)197.63704.66107.75166.31139.83352.21159.96
1,248.35
Net Worth 2008
($1,000)1,072.342,160.964,153.892,726.575,033.552,890.114,854.023,114.221,298.813,599.52
674.003,372.09
547.41638.39591.65
2,021.07827.75
4,171.38
CRNW
(%)2.405.162.975.813.233.023.972.17
(0.26)0.447.935.064.534.484.582.552.913.88
WAND
COKSNW
KSCW
Characteristics of Panel Farms Producing Wheat.
WAW1725WAW4675NDW2180NDW6250KSCW1385KSCW4000KSNW2800KSNW4300COW3000COW5440
Cropland
(acres)
1,7254,6752,1806,2501,3854,0002,8004,3003,0005,440
Assets
($1,000)
1,257.004,056.00
540.002,903.00
778.001,629.001,218.001,785.001,218.002,043.00
Debt/Asset
(ratio)
0.140.150.090.190.200.160.270.150.160.16
Gross Receipts
($1,000)
428.601,076.60
375.101,285.80
193.00548.70318.50625.10298.80529.70
Wheat
(acres)
1,0353,043
7002,700
9282,845
9352,0001,1251,900
• Three wheat farms are projected to be in good overall financial condition with six in moderate condition and only one in poor condition.
• One of the ten wheat farms will feel severe liquidity pressure over the period.
• Only one wheat farm has a significant chance of losing real equity.
Economic Viability of Representative Farms over the 2004-2008 Period
1 Receipts are average annual total cash receipts including government payments, 2004-2008 ($1,000)2 Payments are average annual total government payments, 2004-2008 ($1,000)3 NCFI are average annual net cash farm income, 2004-2008 ($1,000)4 Reserve 2008 are average ending cash reserves, 2008 ($1,000)5 Net Worth 2008 are average nominal ending net worth, 2008 ($1,000)6 CRNW are average percentage in real net worth over 2004-2008 period, (%)
Viability is classified as good (green), moderate (yellow), and poor (red) based on the probabilities:
P(Cash Flow Deficit) is the probability that the farm will have a cash flow deficit. Reported values represent the probabilities for 2004 and 2008.P(Real Net Worth Decline) is the probability that the farm will have a loss in real net worth relative to the beginning net worth. Reported values represent the probabilities for losing real net worth from 2001 to 2003 and from 2001 to 2008.
1
2
3
< 25 > 5026 - 50
1-11-2COW5440
1-11-1COW3000
1-931-41KSNW4300
1-7298-99KSNW2800
1-11-12KSCW4000
1-119-38KSCW1385
1-112-35NDW6250
1-2513-45NDW2180
1-228-27WAW4675
1-814-32WAW1725
2004-20082004-20083/6/1
P(Real Net Worth Declines)P(Cash Flow Deficit) Farm Name
Implications of the January 2004 FAPRI Baseline on the Economic Viability of Representative Farms Primarily Producing Wheat.
Receipts Payments NCFI Reserve 2008 Net Worth 2008 CRNW
($1,000) ($1,000) ($1,000) ($1,000) ($1,000) (%)
WAW1725WAW4675NDW2180NDW6250KSCW1385KSCW4000KSNW2800KSNW4300COW3000COW5440
445.421,043.48
376.741,292.23
195.83561.43340.41655.26300.20527.99
46.86132.4443.07
133.9229.1873.5739.9574.4728.3957.18
117.46284.5384.38
390.6675.97
253.6445.51
159.90130.92237.94
194.55530.69184.68968.44107.38586.28
(284.70)273.54300.71576.86
1,229.873,794.54
593.442,992.06
685.181,780.86
768.591,717.531,257.152,151.48
2.272.382.013.832.094.84
(1.73)2.604.244.12
CA
TN
TXSPTXRP
TXCB
ARLA
AL
NC
GA
TXMC
TXEC
TXVC
TXPC
Characteristics of Panel Farms Producing Cotton.
CAC2400CAC9000TXSP2239TXSP3745TXPC2500TXEC5000TXRP2500TXMC3500TXCB1850TXCB5500TXVC4500LAC2640ARC5000TNC1900TNC4050ALC3000GAC1700NCC1500
Cropland
(acres)
2,0009,0002,2393,7452,5005,0002,5003,5001,8505,5004,5002,6405,0001,9004,0503,0001,7001,500
Assets
($1,000)
5,058.0017,150.00
764.001,455.001,622.001,134.00
424.001,003.00
964.001,258.002,031.00
971.004,259.001,750.003,740.001,761.002,175.001,690.00
Debt/Asset
(ratio)
0.130.140.110.120.160.390.130.150.120.170.240.220.170.060.140.120.230.15
Gross Receipts
($1,000)
2,098.8010,899.60
632.10828.60811.20
1,120.40229.30
1,281.50549.30
1,293.901,314.00
952.702,772.90
707.101,696.301,308.601,240.30
702.90
Cotton
(acres)
1,0004,5001,6162,6251,1844,3001,1221,750
9252,7502,3881,4981,801
9152,6702,0751,0201,000
• Two of 18 cotton farms are characterized as being in good overall condition, with 14 farms characterized in moderate and 2 in poor condition.
• Nearly one-half of the farms are projected to have severe cash flow problems over the period.
• Two of the 18 cotton farms have more than a 45 percent chance of losing real equity.
Economic Viability of Representative Farms over the 2004-2008 Period
1 Receipts are average annual total cash receipts including government payments, 2004-2008 ($1,000)2 Payments are average annual total government payments, 2004-2008 ($1,000)3 NCFI are average annual net cash farm income, 2004-2008 ($1,000)4 Reserve 2008 are average ending cash reserves, 2008 ($1,000)5 Net Worth 2008 are average nominal ending net worth, 2008 ($1,000)6 CRNW are average percentage in real net worth over 2004-2008 period, (%)
Viability is classified as good (green), moderate (yellow), and poor (red) based on the probabilities:
P(Cash Flow Deficit) is the probability that the farm will have a cash flow deficit. Reported values represent the probabilities for 2004 and 2008.P(Real Net Worth Decline) is the probability that the farm will have a loss in real net worth relative to the beginning net worth. Reported values represent the probabilities for losing real net worth from 2001 to 2003 and from 2001 to 2008.
1
2
3
< 25 > 5026 - 50
1-5153-81LAC26401-13-21ARC50001-11-8TNC19001-1225-32TNC40501-128-37ALC30001-699-61GAC17001-4734-69NCC1500
1-522-29CAC24001-1130-27CAC90001-1844-59TXSP22391-2345-52TXSP37451-233-42TXPC25001-2456-56TXEC50001-1033-29TXRP25001-437-30TXMC35001-742-40TXCB18501-2045-55TXCB55001-840-46TXVC4500
2004-20082004-20082/14/2P(Real Net Worth Declines)P(Cash Flow Deficit) Farm Name
Implications of the January 2004 FAPRI Baseline on the Economic Viability of Representative Farms Primarily Producing Cotton.
Receipts Payments NCFI Reserve 2008 Net Worth 2008 CRNW
($1,000) ($1,000) ($1,000) ($1,000) ($1,000) (%)
CAC2400CAC9000TXSP2239TXSP3745TXPC2500TXEC5000TXRP2500TXMC3500TXCB1850TXCB5500TXVC4500LAC2640ARC5000TNC1900TNC4050ALC3000GAC1700NCC1500
202.57921.72
86.81132.21183.90262.92
59.54219.51
93.26276.62249.96
163.40668.05118.85272.21253.60155.13121.97
375.762,069.72
103.80147.55184.81169.66
86.60305.24155.77191.46319.39
91.41722.33306.29462.87427.27151.31120.15
1,197.375,626.38
96.74187.80517.50118.67201.34722.59398.68481.30393.23
11.551,749.551,050.511,204.641,512.24
(1.04)108.60
4,835.7417,664.30
743.661,453.161,714.171,076.10
538.801,478.051,116.391,362.252,140.96
816.584,865.912,387.924,101.602,587.471,654.921,518.19
2.574.302.642.123.163.226.34
10.446.014.026.56
(0.40)5.316.433.817.511.97
(0.10)
2,117.2011,161.78
623.63845.89892.42
1,207.17259.65
1,326.01567.37
1,337.341,377.16
974.652,683.46
728.341,812.241,392.511,199.98
768.79
CA
TXB
MO
ARW
LAS
MSLAN
ARH
TXTXE
ARS
Characteristics of Panel Farms Producing Rice.
CAR424CAR2365CABR1365CACR1420TXR1553TXR3774TXBR1650TXER3200LASR1200LANR2500MOER4500MOWR4000ARSR3640ARWR1200ARHR3000MSR4735
Cropland
(acres)
4242,3651,0001,4201,5533,7741,6503,2001,2002,5004,5004,0003,6401,2003,0004,736
Assets
($1,000)
917.003,576.001,692.002,156.00
525.001,142.00
733.001,066.00
418.002,435.006,188.006,774.004,620.001,754.003,510.001,750.00
Debt/Asset
(ratio)
0.280.220.350.350.180.180.040.270.250.210.120.150.140.160.170.17
Gross Receipts
($1,000)
334.601,952.30
823.501,097.00
471.001,228.70
631.201,218.20
428.601,146.701,773.001,859.401,461.50
613.301,469.002,017.80
Rice
(acres)
4002,2401,0001,278
8552,9401,0252,304
6601,0001,5002,0001,742
6001,5001,335
• Three of the 16 rice farms are projected to be in good overall financial condition with 5 in moderate and 8 in poor condition.
• Slightly more than one-half of the rice farms are expected to face severe cash flow problems and 6 of 16 have high probabilities of real equity losses.
Economic Viability of Representative Farms over the 2004-2008 Period
1 Receipts are average annual total cash receipts including government payments, 2004-2008 ($1,000)2 Payments are average annual total government payments, 2004-2008 ($1,000)3 NCFI are average annual net cash farm income, 2004-2008 ($1,000)4 Reserve 2008 are average ending cash reserves, 2008 ($1,000)5 Net Worth 2008 are average nominal ending net worth, 2008 ($1,000)6 CRNW are average percentage in real net worth over 2004-2008 period, (%)
Viability is classified as good (green), moderate (yellow), and poor (red) based on the probabilities:
P(Cash Flow Deficit) is the probability that the farm will have a cash flow deficit. Reported values represent the probabilities for 2004 and 2008.P(Real Net Worth Decline) is the probability that the farm will have a loss in real net worth relative to the beginning net worth. Reported values represent the probabilities for losing real net worth from 2001 to 2003 and from 2001 to 2008.
1
2
3
< 25 > 5026 - 50
P(Real Net Worth Declines)P(Cash Flow Deficit)Farm Name
1-479-81ARWR12001-1913-74ARHR3000
1-925-47MOWR40001-210-17ARSR3640
1-617-78MSR4735
1-13-21MOER4500
1-102-39TXBR16501-1717-43TXER32001-3716-60LASR12001-6525-95LANR2500
1-12-9TXR3774
1-9999-99CAR4241-6429-88CAR23651-9999-99CABR13651-9999-99CACR14201-1912-49TXR1553
2004-20082004-20083/5/8
Implications of the January 2004 FAPRI Baseline on the Economic Viability of Representative Farms Primarily Producing Rice.
Receipts Payments NCFI Reserve 2008 Net Worth 2008 CRNW
($1,000) ($1,000) ($1,000) ($1,000) ($1,000) (%)
CAR424CAR2365CABR1365CACR1420TXR1553TXR3774TXBR1650TXER3200LASR1200LANR2500MOER4500MOWR4000ARSR3640ARWR1200ARHR3000MSR4735
321.421,875.30
791.121,051.88
439.541,144.52
588.641,138.65
399.081,080.951,711.791,698.151,349.00
560.741,354.471,889.72
147.19858.26366.45488.28180.63457.58244.48471.17143.00325.90468.00601.30473.70193.73484.28516.30
11.36121.2647.17
(113.66)93.02
362.75130.85139.9564.66
103.83596.97470.34421.42115.94224.20225.20
(320.40)(242.95)(404.03)
(1,153.33)115.45
1,026.55390.40161.15
42.85(202.53)
1,715.481,011.48
973.44(27.69)92.28
174.15
443.972,589.29
918.05465.95529.25
1,730.69886.08991.31357.02
1,819.656,615.896,391.254,456.181,462.443,003.581,619.29
(5.99)(1.14)(3.84)
(13.33)1.959.702.152.18
(0.06)(0.94)3.672.052.45
(0.22)0.65
(0.94)
WA
ID
CA
NM TXETXC
MO
FLS
FLN
WI
NYCNYW
VT
TXN
Characteristics of Panel Farms Producing Milk.
CAD1710NMD2000WAD250WAD850IDD750IDD2100TXND2400TXCD500TXCD1300TXED550TXED1000WID135WID700NYWD800NYWD1200NYCD110NYCD500VTD134VTD350MOD85MOD400FLND500FLSD1500
Cropland
(acres)800400200605240560260250460300875600
1,2001,4402,160
2961,100
220700230450600400
Assets
($1,000)10,548.00
6,267.001,863.004,612.003,681.00
10,036.008,829.002,027.005,175.001,525.004,082.002,136.004,022.004,712.007,537.00
890.003,217.00
950.002,920.00
923.002,379.002,879.006,698.00
Debt/Asset
(ratio)0.210.210.230.330.240.100.200.350.170.160.090.210.170.240.240.140.150.130.210.150.160.110.33
Gross Receipts
($1,000)5,103.406,022.00
837.402,780.002,434.406,500.006,660.801,331.104,262.601,290.902,874.90
487.802,302.402,631.603,928.60
435.201,760.30
455.701,228.20
240.401,107.301,839.904,291.70
Cows
(number)1,7102,000
250850750
2,1002,400
5001,300
5501,000
135700800
1,200110500134350
85400500
1,500
• The dairy operations are almost evenly divided between good, moderate, and poor condition at 8, 7, and 8 farms, respectively.
• About one-half of the dairies are projected to experience liquidity pressure with only a few experiencing declines in real equity.
Economic Viability of Representative Farms over the 2004-2008 Period
1 Receipts are average annual total cash receipts including government payments, 2004-2008 ($1,000)2 Payments are average annual total government payments, 2004-2008 ($1,000)3 NCFI are average annual net cash farm income, 2004-2008 ($1,000)4 Reserve 2008 are average ending cash reserves, 2008 ($1,000)5 Net Worth 2008 are average nominal ending net worth, 2008 ($1,000)6 CRNW are average percentage in real net worth over 2004-2008 period, (%)
Viability is classified as good (green), moderate (yellow), and poor (red) based on the probabilities:
P(Cash Flow Deficit) is the probability that the farm will have a cash flow deficit. Reported values represent the probabilities for 2004 and 2008.P(Real Net Worth Decline) is the probability that the farm will have a loss in real net worth relative to the beginning net worth. Reported values represent the probabilities for losing real net worth from 2001 to 2003 and from 2001 to 2008.
1
2
3
< 25 > 5026 - 50
1-6499-96NYWD8001-4699-89NYWD12001-11-1NYCD1101-118-19NYCD5001-119-3VTD1341-6999-99VTD3501-259-54MOD851-150-31MOD4001-129-8FLND5001-9399-99FLSD1500
1-299-28CAD17101-1299-44NMD20001-2599-89WAD2501-8399-99WAD8501-4699-93IDD7501-116-6IDD21001-2692-63TXND24001-9199-99TXCD5001-947-28TXCD13001-1040-29TXED5501-122-13TXED10001-1899-75WID1351-945-34WID700
2004-20082004-20088/7/8P(Real Net Worth Declines)P(Cash Flow Deficit) Farm Name
Implications of the January 2004 FAPRI Baseline on the Economic Viability of Representative Farms Primarily Producing Milk.
Reserve 2008 Net Worth 2008 CRNW($1,000) ($1,000) (%)
CAD1710NMD2000WAD250WAD850IDD750IDD2100TXND2400TXCD500TXCD1300TXED550TXED1000WID135WID700NYWD800NYWD1200NYCD110NYCD500VTD134VTD350MOD85MOD400FLND500FLSD1500
Receipts($1,000)5,458.686,421.19
886.742,977.122,568.716,898.817,108.711,407.514,535.921,347.263,013.36
508.962,460.602,791.744,176.64
438.231,855.66
464.111,295.66
246.831,170.351,942.804,561.52
Payments($1,000)
36.1212.9118.4641.7612.9138.9912.9112.9112.9112.9112.9118.0528.5827.0037.134.75
14.983.721.358.71
12.9112.9112.91
NCFI($1,000)
557.73578.9888.81
(160.73)69.31
1,453.83359.21(62.93)447.44197.93541.4588.99
326.0156.80
171.74158.73292.06114.8719.3257.84
233.69364.07
(357.29)
580.62296.78
(194.93)(2,099.65)
(767.55)4,114.19(317.25)
(1,021.84)759.47294.64
1,675.00(41.37)530.39
(935.85)(873.42)433.31360.13253.23
(582.66)7.76
261.161,060.80
(3,707.52)
9,278.386,094.551,466.941,747.332,629.83
12,743.067,658.38
691.455,210.081,620.535,068.171,669.443,882.633,052.505,421.581,069.903,184.591,029.961,913.51
846.372,478.053,388.772,281.90
3.035.581.72
(6.76)0.157.122.08
(7.68)4.095.166.581.023.59
(1.29)0.257.934.045.31
(1.41)2.134.657.00
(7.92)
MTWY
CO
MO
NV
NM
FL
MOC
TXB
CA
SD
TXS
Characteristics of Panel Farms Producing Beef Cattle.
CAB500NVB700MTB500WYB500COB250NMB240SDB450MOB150MOCB350TXBB150TXSB250FLB1155
Cropland
(acres)
-1,300
-330450-
1,150240
40200-
5,400
Assets
($1,000)
8,893.002,130.002,591.002,392.009,088.002,566.002,679.00
922.002,307.00
782.002,085.00
10,113.00
Debt/Asset
(ratio)
0.010.010.010.040.010.010.010.150.010.010.010.01
Gross Receipts
($1,000)
271.90315.70274.90264.40142.20121.20230.50140.80187.50
1,226.10155.10506.40
Cows
(number)
500700500500250240450150350150250
1,155
• Six of 12 cow-calf operations are projected to be in good overall financial condition. Five are expected to be in moderate condition and one is in poor condition.
• Three of the operations will face liquidity pressures over the period.
• Three operations are projected to have more than a 30 percent chance of losing real equity over the period.
Economic Viability of Representative Farms over the 2004-2008 Period
1 Receipts are average annual total cash receipts including government payments, 2004-2008 ($1,000)2 Payments are average annual total government payments, 2004-2008 ($1,000)3 NCFI are average annual net cash farm income, 2004-2008 ($1,000)4 Reserve 2008 are average ending cash reserves, 2008 ($1,000)5 Net Worth 2008 are average nominal ending net worth, 2008 ($1,000)6 CRNW are average percentage in real net worth over 2004-2008 period, (%)
Viability is classified as good (green), moderate (yellow), and poor (red) based on the probabilities:
P(Cash Flow Deficit) is the probability that the farm will have a cash flow deficit. Reported values represent the probabilities for 2004 and 2008.P(Real Net Worth Decline) is the probability that the farm will have a loss in real net worth relative to the beginning net worth. Reported values represent the probabilities for losing real net worth from 2001 to 2003 and from 2001 to 2008.
1
2
3
< 25 > 5026 - 50
1-21-3TXSB250
1-1510-15SDB450
1-121-23TXBB150
1-4099-47CAB5001-2311-30NVB700
1-321-29NMB240
1-181-26FLB1155
1-17-13MOCB3501-18-16MOB150
1-4476-68COB2501-2899-78WYB5001-11-1MTB500
2004-20082004-20086/5/1P(Real Net Worth Declines)P(Cash Flow Deficit) Farm Name
Implications of the January 2004 FAPRI Baseline on the Economic Viability of Representative Farms Primarily Producing Beef Cattle.
Receipts Payments NCFI Reserve 2008 Net Worth 2008 CRNW
($1,000) ($1,000) ($1,000) ($1,000) ($1,000) (%)
CAB500NVB700MTB500WYB500COB250NMB240SDB450MOB150MOCB350TXBB150TXSB250FLB1155
286.64310.18287.48276.69148.00126.46245.57151.76194.56
1,272.38160.88534.15
------
1.267.45
-1.83
--
49.4261.99
138.1552.3048.0937.0565.6764.7955.5476.0760.7692.58
8.9974.68
567.76(29.26)156.0995.87
162.5362.49
173.04137.14202.93184.32
8,100.472,122.702,841.452,211.598,273.792,390.702,600.64
876.962,470.29
893.852,071.669,382.34
0.060.932.570.410.020.140.652.971.662.310.880.29
IL INIA
Characteristics of Panel Farms Producing Hogs.
ILH200ILH750INH600IAH400
Cropland
(acres)
1,4001,9503,200
667
Assets
($1,000)
1,263.005,422.004,956.00
881.00
Debt/Asset
(ratio)
0.300.280.310.15
Gross Receipts
($1,000)
580.701,864.602,078.10
883.10
Sows
(number)
200750600400
• One hog farm is projected to be in good condition over the period with two in moderate and one in poor financial condition.
• All of the farms are projected to experience liquidity problems, with three being severe.
• None of the hog farms are expected to experience significant real equity declines.
Economic Viability of Representative Farms over the 2004-2008 Period
1 Receipts are average annual total cash receipts including government payments, 2004-2008 ($1,000)2 Payments are average annual total government payments, 2004-2008 ($1,000)3 NCFI are average annual net cash farm income, 2004-2008 ($1,000)4 Reserve 2008 are average ending cash reserves, 2008 ($1,000)5 Net Worth 2008 are average nominal ending net worth, 2008 ($1,000)6 CRNW are average percentage in real net worth over 2004-2008 period, (%)
Viability is classified as good (green), moderate (yellow), and poor (red) based on the probabilities:
P(Cash Flow Deficit) is the probability that the farm will have a cash flow deficit. Reported values represent the probabilities for 2004 and 2008.P(Real Net Worth Decline) is the probability that the farm will have a loss in real net worth relative to the beginning net worth. Reported values represent the probabilities for losing real net worth from 2001 to 2003 and from 2001 to 2008.
1
2
3
< 25 > 5026 - 50
1-3993-79IAH400
1-191-71INH600
1-199-35ILH750
1-1398-88ILH200
2004-20082004-20081/2/1
P(Real Net Worth Declines)P(Cash Flow Deficit) Farm Name
Implications of the January 2004 FAPRI Baseline on the Economic Viability of Representative Farms Primarily Producing Hogs.
Receipts Payments NCFI Reserve 2008 Net Worth 2008 CRNW
($1,000) ($1,000) ($1,000) ($1,000) ($1,000) (%)
ILH200ILH750INH600IAH400
583.861,891.722,176.92
897.95
40.1977.00
135.4324.49
107.53477.96412.50
66.71
(79.15)158.84
(128.19)(61.78)
942.764,761.614,046.02
756.50
1.984.604.040.59
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