Landowners and producers with pastures may want to revisit Pasture, Rangeland, and Forage (PRF) insurance. PRF is available for 2017 in South Dakota and neighboring states based on a Rainfall Index (RI), similar to a year ago. The 2017 base price used to pay out for grazing losses has been adjusted from the 2016 rate.
It is no secret that compared to recent years the 2016 calf market will be disappointing for sellers. However, producers must make decisions about their 2016 calf crop. There are options available depending on each situation. Some popular press articles have suggested that cow-calf producers should retain ownership to enhance profitability. However, producers should make sure they consider all factors before changing marketing plans to increase their chances for success.
Measuring the farm’s economic success can be accomplished by annually comparing the balance sheet, income statement, statement of cash flows and statement of owners’ equity. Comparing these financial statements can only be done if they are completed at a similar time of the year and if they are completed accurately and consistently.
As South Dakota's farmers, ranchers and communities deal with the challenges brought on by drought conditions impacting more than half the state, SDSU Extension is connecting individuals with resources and research-based information.
The cash rental rates for pasture/rangeland in South Dakota last year saw some fairly large increases across the state. Despite a downward change in feed and live cattle prices in 2015, cash rental rates still increased. The state average for pasture/ rangeland rental was $31.40 per acre in 2015 and $28.40 in 2014.
The overall South Dakota economy is stable based on aggregate data from the Bureau of Economic Analysis (BEA). Gross Domestic Product (GDP) in South Dakota, measured for the third quarter of 2015, was $46.6 billion and steady with a year earlier. Annual State Personal Income for 2015 was recently released and totaled $38.6 billion, unchanged from a year earlier. The latest unemployment rate for South Dakota was 3.2% in February, low by national standards (Labor Market Information Center, 2016). Holmquist and Diersen (2015) found similar growth rates of farm and non-farm measures of economic activity from 1998 to 2014 at the state level.
The 2016 forecast of national net farm income was recently released by the USDA Economic Research Service (ERS). The ERS estimates a 3 percent decline compared to 2015 income figures. This is a potential decrease of $1.65 billion dollars in net farm income, a reduction in farm income from $56.45 billion in 2015 to $54.8 billion in 2016.
Calving season is one of the most exciting, frustrating and tiring seasons of the year for many cattlemen. This is a time when the only thing that compares to watching a newborn calf struggle to its feet for the first time is the sound of it nursing its dam for the first time. However, when best laid plans do not work out as expected and a dry cow results, what management plan do you have in place to maintain an efficient and economically viable cow herd?
Depreciation is an important part of keeping records in agriculture. Depreciation is a reduction in the value of an asset over time, due to wear and tear. Things such as tractors, trailers, etc. all depreciate over time. Depreciation is also a way to make an income tax deduction to recover the cost of qualifying assets. Careful consideration of how to report tax depreciation helps producers comply with IRS regulations and can result in a reduction of income taxes paid.
While most people must file taxes by April 15, 2016, farmers’ and ranchers’ taxes must be filed by March 3rd. Due to the filing deadline many producers are beginning the process of gathering their important paper work. In general, the law does not require any specific kinds of records (there are a few exceptions though). A producer can choose any kind of record keeping system they wish to use for their business (ex. Quicken, QuickBooks, Easy Farm, paper ledger, paper journal etc.).