What is in this article?:
- Alabama farm economy compared to kaleidoscope
- Good commodity prices, scorching drought
• At any given time, about a third of farmers are making money, a third are breaking even, while the remaining third are not turning a profit.
A few years ago, a television drug advertisement pointed out how life often comes in twos.
Paraphrasing this, an Alabama Extension economist says farm profitability typically comes in thirds.
“At any given time, about a third of farmers are making money, a third are breaking even, while the remaining third are not turning a profit,” says Max Runge, an Alabama Cooperative Extension System agricultural economist.
Runge formulated this view after being challenged a few weeks ago by a reporter’s passing question about whether farming was profitable.
He remembers being taken aback by the question and temporarily left at a loss for words.
Runge says it is a great question — an obvious question — but one that had never been asked during his long tenure as a farm economist.
The question prompted some deep thought on his part.
After thinking about it, Runge says the Alabama’s farming landscape could be compared to a kaleidoscope, one that always changes colors and shapes and that is more subject to market and weather fluctuations than farm sectors in other parts of the country.
How most producers fare from year to year boils down to the types of crops they raise, where they live and how well they deal with unexpected events such as weather and economic factors.
As a state that stretches from the mountains to the sea, Alabama possesses several different climatic regions — another big factor in how farm fortunes play out year after year.
Runge says the 2011 crop served as case in point of how this kaleidoscope constantly changed, how unanticipated events work to the advantage of some segments of Alabama farming sectors and to the distinct disadvantage of others.
“The Wiregrass in southeast Alabama reeled from drought, a factor complicated by equally severe droughts in Texas and Oklahoma,” “We typically aren’t affected by what happens in these two states, but last year severe drought forced a sell-off of huge numbers of cattle. What remained placed a heavy demand on hay supplies, driving up hay costs in Alabama and the Southeast in general.”