Farm Income

Farmers struggling against increasingly uncertain tobacco profits are diversifying in the rugged highlands of eastern Kentucky--they're becoming shepherds. One of the driving forces in the change is Mike Hancock, a teacher at Harry Sparks Vocational School in Mount Vernon. He has been promoting sheep raising in 16 counties in a program sponsored by the state Office of Vocational Education. "We've got farmers doing very well with sheep in these depressed farm times," Hancock said.

Is this more bad news? Japan refused to relax its trade barriers and buy U.S. rice last week. And the Soviet Union broke off talks on a new purchase agreement for U.S. grain two weeks ago. Amid all our other trade worries, are agricultural export markets drying up, too? Not at all. Not only does food remain one of the United States' most successful and promising export products, but the outlook in global markets is strong.

For some Agriculture Department analysts with good memories, old textbooks or both, there are disturbing similarities between what's been going on since 1981 and the boom-that-busted era of the 1920s and '30s. But John Kitchen and Gregory Gajewski of the department's Economic Research Service think any recession will be mild by historical standards. Unless a few things go completely haywire.

Thanks to sky-high commodity prices, American farmers will see their income leap to an estimated $55.8 billion in 2003, up $20.5 billion from last year, the U.S. Agriculture Department said. The 2003 profits from grain, cattle, vegetables and other agricultural products would be the second-highest farm net income in history, behind $57.8 billion in 1996, the USDA said. Commodity prices have exploded in recent months because of an export boom led by Chinese demand, a smaller-than-expected U.S.

Revenues from California farms decreased 5% in 1991, hit by the fifth year of drought, the December, 1990, freeze and last fall's whitefly infestation, preliminary figures show. The decline was the first drop in six years, but it wasn't as bad as some had forecast, said Ray Borton, state Food and Agriculture Department's senior economist. Diverse crops and adaptable farmers cushioned the blow of the elements, he said. Cash receipts from crop and livestock production dropped $1 billion to $17.

More than one farmer having trouble keeping ahead of his bills has turned to amaranth, arrowroot, cipolines, daikon and manzano. They're not bankruptcy lawyers. They're exotic vegetables, fruits and seeds. These and others, from fava beans to purple potatoes, are being grown on "gourmet farms" to meet increasing demand for specialty foods. In some cases, they are more profitable than conventional crops. Frieda Caplan, owner of Frieda's Finest Produce Specialties Inc.

Pressure in the Legislature built Monday for Gov. Pete Wilson to take action against his Department of Food and Agriculture Secretary Henry J. Voss for Voss' failure to disclose receiving more than $100,000 in outside income from farming operations since 1989. Wilson's aides questioned Voss Thursday--the day Wilson announced his presidential exploratory committee--about Voss' failure to report the income in his annual conflict of interest statements.

Profits for U.S. farmers will fall to the lowest since 2003 as crop prices stay below last year's records and expenses decline more slowly than revenues, the government said. Net farm income will drop 20% to $71.2 billion this year, down from a revised $89.3 billion in 2008, the highest ever, the U.S. Department of Agriculture said. The USDA in November projected 2008 net farm income at $86.9 billion. Corn, wheat and soybean prices have fallen at least 40% from last year's records.

Personal income growth slowed from July through September for the second consecutive quarter last year as the economy was sliding toward recession, government figures showed today. The Commerce Department's Bureau of Economic Analysis said personal incomes grew 1.2% nationally in the third quarter, down from 1.3% during the second quarter and 2.1% in the first. "The continued slow growth of U.S.