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Ag sales in ’08 top $560M

Agriculture generated more than $1 billion in the Rochester region over the past two years, including more than a half-billion dollars in 2008, preliminary data from the New York Agricultural Statistics Service show. 

Cash receipts for crops and livestock in Genesee, Livingston, Monroe, Ontario, Orleans and Wayne counties totaled $564.9 million in 2008, up nearly 19 percent from $475.2 million in 2007. 

"(Local) agriculture is way more important than people realize," said James Ochterski, agricultural economic development specialist for the Cornell Cooperative Extension of Ontario County. 

Wayne County logged the most cash receipts in the six-county region with $165.4 million in 2008, up from $139.2 million in 2007. The county also ranked second in the state, behind Suffolk County, which had cash receipts totaling $289.1 million. 

Orleans County reported cash receipt sales of $114.6 million, up from $96.4 million the prior year; followed by Genesee County with $81 million, up from $68.2 million in 2007. Monroe County ranked fourth locally with cash receipts of $79.2 million in 2008, up from $66.6 million. 

Ontario County logged cash receipts totaling $63.8 million in 2008, up from $53.7 million, while Livingston County’s cash receipts for 2008 totaled $60.1 million, up from $51.2 million. 

The allocation of farm income to counties uses information collected by the National Agricultural Statistics Service, the U.S. Department of Agriculture’s Economic Research Service and the 2007 Census of Agriculture, which is the most current census data available. The money generated does not include wineries, food processors or suppliers. 

Statewide, farmers’ cash receipts for their crops totaled $4.69 billion in 2008, up 7 percent from 2007. Crop sales increased 19 percent to $2.01 billion for 2008. Receipts from livestock and poultry products were $2.68 billion, a decrease of 1 percent from the year before. 

The 2007 numbers are well below those reported in the region in 2005 and 2006. Ochterski said it is hard to identify one reason for the drop in cash receipts. Several factors could have caused the one-year decline, including the sampling method, weather and commodity pricing, he said. 

The drop also could be due to a certain industry or crop. For example, Genesee, Livingston and Ontario counties have a number of dairy farms, and those were the counties that reported a decrease in cash receipts between 2006 and 2007. 

By contrast, Orleans, Monroe and Wayne counties, which are predominantly fruit- and vegetable-growing counties, reported increases in cash receipts in 2007. 

Growth in 2008 

Alison DeMaree, a regional specialist in fruit farm business management with the Cornell Cooperative Extension of Wayne County, said a variety of factors led to an above-average year for apple growers there. Those factors included a shortage of apples nationwide, particularly from Washington and Michigan, as well as hailstorms that hurt crops in other parts of New York. A superior crop in Wayne County also led to demand for the apples, which drove up the price. 

"It’s really all about supply and demand," DeMaree said. "Last year, the market psychology drove the price up." 

She expects a high-quality apple crop this year, especially because of the cool nights, which are ideal for apples, but not the same level of sales generated in 2008. 

Robert King, director of Monroe Community College’s Agriculture and Life Sciences Institute, said 2008 was a year when crop cash receipts increased but farmers still faced challenges, particularly because of high energy costs. 

King said the region, particularly Monroe County, is critical to the ag-based economy because of the number of food-related services in the county that require products from area farmers. 

"At its peak, there can be 1 million people in Rochester at a given time," King said. "It is one of the largest markets upstate for farm products." 

A mix of businesses benefits from local farming, ranging from food processors to the trucking companies that haul the products, King said. In addition, municipalities benefit from farms because the green space does not require as many services as commercial and residential areas. 

"Many communities want farms to keep operating costs low," King said. 

He is optimistic about 2009 data, noting ideal weather conditions. Local crop yields are 5 percent to 10 percent above average at this time of year, he said. 

Ochterski said a spike in commodity prices in early 2008 for crops such as wheat, corn and soybeans helped area farmers. The demand for the crops was worldwide, due partly to droughts in other parts of the world and a global grain shortage. Those factors, coupled with the relatively low value of the dollar, contributed to the increased price of crops exported from the United States, he said. 

Ochterski said the rise in crop cash receipts is "a global economic effect we saw locally." 

"Our crops were a bargain in other parts of the world," Ochterski said.  

That may not be the case this year because abundance is driving prices down, he noted.

Big business 

Still, agriculture remains a strong part of the local economy. He noted that Ontario County farms will contribute more than $130 million to the economy. That includes ag suppliers; crop processing; storage businesses; academic research institutions, such as the Cornell Food and Agricultural Technology Corp. in Geneva; and tourism destinations, from farmers markets to the New York Wine & Culinary Center in Canandaigua. 

Wayne County leaders have also seen agriculture as an incredibly important part of the economy for some time, said Ora Rothfuss, an agricultural development specialist with the Wayne County Planning Department. County leaders created his position in 1998. 

Rothfuss pointed to the 2007 ag census, which showed that Wayne County’s 938 farms generated $168.9 million in goods. Of that amount, some $86 million came from fruit farms. 

A few years ago, agriculture was identified as a major asset in a countywide strategic plan adopted by the Wayne County Board of Supervisors. While they do not contribute to the cash receipts figures, there are several national food companies in Wayne County, including Baldwin Richardson Foods Co. in Macedon, Mott’s Inc. in Williamson and Seneca Foods Corp., which has its headquarters in Marion. 

The county’s industrial development agency runs an agribusiness micro-enterprise program that provides technical assistance and low-interest loans to help small farmers and agribusiness owners with five or fewer workers to expand or diversify their operations or start new enterprises. 

Wayne County has been taking additional measures to protect its agricultural assets, Rothfuss said. He has spent a large part of his time helping towns preserve farmland and works with farmers on land ownership issues, including when farms change hands. 

Despite the growth in 2008, farmers continue to face challenges. They have been losing money on their dairy operations as the federally regulated price they receive for milk and other dairy products began hitting record lows earlier this year. 

Dairy product sales in New York fell to $2.31 billion in 2008 from $2.38 billion in 2007 but still represented nearly half of the total of statewide ag sales. 

Over the past month, state leaders have called for steps to relieve dairy farmers’ plight. Sen. Charles Schumer, D-N.Y., recently proposed immediate payments to farmers through the Commodity Credit Corp., an existing government program, to provide short-term nationwide relief. Under the proposal, farmers in the Rochester and Finger Lakes region would have access to $43 million. 

This month, Rep. Eric Massa, D-Corning, was host for a meeting in Canandaigua with Rep. Collin Peterson, D-Minn., chairman of the House Agriculture Committee. The two suggested using money from the federal stimulus package not already allocated elsewhere as a way to help dairy farmers. 

Peterson’s visit to the area followed an event at Genesee Community College in Batavia that brought together politicians, economists, farmers and others to consider reforms in dairy pricing. 

Massa and Rep. Chris Lee, R-Williamsville, took part in the hearing, which was held by Sen. Kirsten Gillibrand, D-N.Y. Gillibrand is the first member from New York on the Senate Agriculture Committee in nearly 40 years. In June, she pledged to hold dairy hearings in both New York and Washington, D.C. 

The drop in dairy prices was first seen in early 2008, Ontario County’s Ochterski said, and prices continued to fall through the year. He believes a better pricing formula is needed. 

"It has been a painful time for dairy farmers," Ochterski said. "Anything the government can do to increase the amount of income for dairy farmers is a good thing."

adeckert@rbj.net / 585-546-8303

09/18/09 (C) Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303. 

 

 

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