• Topics: Food and Resource Economics | Clouser, Rodney L | 2007 Agricultural Census Tidbits series

2007 Agricultural Census Tidbit: Florida Farm Sales Up but National Rank Down¹

Introduction

The 2007 agricultural census data were reported for states and counties throughout the United States in February 2009. National, state, and local policy makers look forward to the census report for several reasons: they use the information to show the importance and size of the industry in their state and counties, and to show the importance of the industry in the state and local economy; and they use the information to make policy decisions. One of the limitations of the agricultural census is that the report, for the most part, is just data with limited or no discussion. This publication is one in a series of five that reorganizes some of the data collected in the census and offers some comments on trends and gaps in the data. The other publications in the 2007 Agricultural Census Tidbit series can be accessed online at http://edis.ifas.ufl.edu.

The information in this factsheet specifically reports on the value and rank of agricultural sales by state based on 2002 and 2007 agricultural census data. There is some discussion of the data's potential limitations. They are a useful aid but not always an effective policy-making decision tool or long-term predictor of trends in the industry in any given state.

Census of Agriculture

The Census of Agriculture is conducted every five years and is an attempt by the U.S. government to collect data on the entire U.S farm population in every state. Of course, not all agricultural producers provide information that is requested and there is always the possibility for error in the data reported. A farm is defined as a place in which $1,000 of agricultural products were produced or sold, or typically would have been sold during the census year, including any government payments.

Agricultural Sales

Agricultural sales by state and rank for 2002 and 2007 are reported in Table 1. Total sales in 2007 were $297.2 billion, up from $200.6 billion in 2000. California ($33.9 billion) is by far the largest sales state in 2007. The top ten sales states accounted for 53.6 percent of total U.S. sales. The ranking of the five largest sales states (California, Texas, Iowa, Kansas, and Nebraska) remained identical between 2002 and 2007, but there was some reshuffling in rank of the next five largest states. In 2007, Illinois ranked 6th in sales, changing ranks with Minnesota, which dropped to 7th largest in terms of sales. Wisconsin moved from 10th in 2002 to 9th in 2007. Florida, which had ranked 9th in 2002, dropped to 11th. Indiana, which had ranked 15th in 2002, ranked 10th in sales in 2007.

Florida

Florida's rank in terms of agricultural sales dropped from the 9th largest state in 2002 to the 11th largest state in 2007, in spite of the fact that agricultural sales in the state increased from $6.2 billion in 2002 to about $7.8 billion in 2007. The obvious implication of this drop is that agricultural sales grew at a slower rate between 2002 and 2007 in Florida than in the other U.S. states.

The rate of growth and rank in state agricultural sales between the 2002 and 2007 census is reported in Table 2. Nationally, the average growth rate in sales among U.S. states was 48.1 percent. By comparison, the median (midpoint where half the states are above and half are below) was 41.8 percent. Florida's growth rate in sales between these time periods was only 24.7 percent, which ranked the state 42nd nationally in terms of growth, or at about half the level of the average national growth rate.

Census Data Limitations

Census data have certain limitations. The data reporting a slower-than-national growth rate in Florida agricultural sales do not necessarily indicate a declining agricultural industry or a less important industry to the state and local economy. The data cannot predict long-term trends, nor indicate whether the state will fall further in ranking because of slower agricultural sales growth between 2002 and 2007.

It is likely, to some degree, that the relatively slow growth in Florida agriculture sales reflects challenges experienced by the industry related to global competition, risk management (diseases, disasters, financing), commodity and input prices, and increasing commodity prices (corn) in other regions of the United States. However plausible they appear, these conclusions cannot be made based on the census data; individuals, consumers and policy makers should not read too much information into census reports.

An important factor to consider when looking at Florida agricultural sales data in 2007 is that the census represents a snapshot of state sales data across the nation. The census data represent agricultural conditions as of December 31, 2007 as reported by farm producers in February 2008. Data reported in Table 2 clearly indicate distortions that may exist when reporting information for a specific point in time.

Of the ten fastest states in sales growth, nine were located in the Midwest or Plains states. Growth in agricultural sales in the top ten states ranged between 59 and 88 percent, compared to the national average of 48.1 percent. Why the huge growth in the agricultural sales in the Midwest states? The time frame of the 2007 Census of Agriculture covered was during the middle of the ethanol boom. Corn prices literally doubled from about $2 per bushel in late 2006 to about $4 a bushel in 2007. It is very likely that Florida's drop in rank in terms of sales was largely created by the ethanol boom that dramatically increased corn prices in 2007 and that no longer exists today. Unpredictable events like the ethanol boom can distort data reported and could lead people to draw invalid conclusions.

Summary

Florida agriculture remains a large and important industry in the state. Although the state's relative rank in terms of agricultural sales dropped from 9th to 11th nationally between 2002 and 2007, the dollar value of sales increased from $6.2 billion to $7.8 billion.

Agricultural sales is an important factor in determining the importance of the industry in a state. However, the sales value of commodities produced should not be used as the sole measurement of the value of the industry. Individuals, producers, and policy makers also need to remember that census data represent snapshots of the industry at a specific point in time and may not be reflective of future trends.

References

USDA/NASS. 2007. 2007 Census of Agriculture, United States Summary and State Data, Volume 1, Geographic Area Series, Part 51. United States Department of Agriculture, National Agricultural Statistics Service, Washington, D.C.

USDA/NASS. 2007. 2007 Census of Agriculture. United States Department of Agriculture, National Agricultural Statistics Service, Washington, D.C. (July) http://www.agcensus.usda.gov/Newsroom/2009/2007_Census.ppt#359,6,Farm Definition

Tables

The Institute of Food and Agricultural Sciences (IFAS) is an Equal Opportunity Institution authorized to provide research, educational information and other services only to individuals and institutions that function with non-discrimination with respect to race, creed, color, religion, age, disability, sex, sexual orientation, marital status, national origin, political opinions or affiliations. For more information on obtaining other extension publications, contact your county Cooperative Extension service.

U.S. Department of Agriculture, Cooperative Extension Service, University of Florida, IFAS, Florida A. & M. University Cooperative Extension Program, and Boards of County Commissioners Cooperating. Nick T. Place, Dean.

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