Fruit and Tree Nuts: Net cash income and selected characteristics of U.S. farms producing fruits, tree nuts, and berries – 1987 Census of Agriculture reports fruit, tree nut and berry farms vary in income, crops and structure

Net cash income and selected characteristics of U.S. farms producing fruits, tree nuts, and berries – 1987 Census of Agriculture reports fruit, tree nut and berry farms vary in income, crops and structure according to region, type and size – U.S. Dept. of Agriculture, Economic Research Service report

Doyle C. Johnson

According to the 1987 U.S. Census of Agriculture, fruit and tree nuts were produced on 4.56 million acres of orchard land located on 120,434 farms. The fruit and nut industry, combined with berries, now presents a $9-billion-plus industry at the producer level.

This report presents data on the number of farms, acreage, net cash income, farm production expenses, sales, and prices received by noncitrus fruit, citrus, tree nut, and berry farms in the United States. The data were obtained by USDA’s Economic Research Service as special tabulations of the 1987 Census of Agriculture for 43 fruit, tree nut, and berry commdities. These data make it possible to examine more detailed information on the U.S. fruit, nut, and berry industry by commodity, geographic area, and farm size.

Definitions

In this report, a measure of net cash income for fruit, nut, and berry farms is calculated by substracting total farm production expenses from gross cash receipts. This is defined as the “net cash income from agricultural sales”, or the operator’s share of the value of agricultural products sold minus the operator’s cash operating expenses and cash rent.

Gross receipts or “total market value of agricultural products sold” exclude Government payments, any other farm-related income such as custom work or agricultural services, and nonfarm income. Also, “total farm production expenses” exclude cash expenditures for capital improvements and production expenses paid by landlords. Therefore, this definition of net cash income would not necessarily provide accurate estimates of disposable income of farm operator households. However, the estimate provides a general measure of the financial viability of the farms producing specific fruit, tree nut, and berry crops.

“Total land in farms” consists of agricultural land used for cropland, grazing, or pasture, including woodlands and wastelands–except that which is held for nonagricultural purposes. Total land in farms is an operating-unit concept and includes land owned and operated, as well as land rented from others. “Land in fruits, nuts, and berries” as well as the number of acres shown for each specific crop includes bearing and nonbearing acreages. The farm numbers presented are “all farms”, those with any sales of the specific commodity shown.

Net Cash Income From Agricultural

Sales

Table A-1 lists the 43 specific crops studied and presents information for each crop: 1) the total number of farms reporting sales of each fruit, tree nut, and beery crops; 2) the total number of acres in farms, acreages for fruits, nuts, and berries, and the 43 crops specified; 3) the total value of sales of all agricultural products and sales of fruits, nuts, and berries; 4) the total amount of farm production expenses; and 5) net cash income per farm and total U.S. net cash income for each of the 43 fruit, nut, and berry crops.

Total agricultural sales were highest in 1987 for farms selling grapes (2) ($2.47 billion), followed by oranges ($2.22 billion), apples ($2.10 billion), almonds ($1.70 billion), grapefruit ($1.31 billion), and peaches ($1.45 billion). Subtracting farm production expenses from the total agricultural sales figures results in “net cash income” as follows: oranges ($610 million), grapes ($513 million), grapefruit ($414 million), apples ($386 million), and almonds ($344 million).

The specialization of these farms in fruits, tree nuts, and berries varied considerably by crop. Farms reporting3 dates, papayas, kumquats, wild bluedberries, and cranberries were more specialized, with over 90 percent of total farm sales from fruits, tree nuts, and berries. Farms reporting sales of bananas, almonds, filberts, macadamias, pecans, and most bushberry crops were more diversified, with less than 55 percent of total farm sales accounted for by fruits, tree nuts and berries. The degree of specialization among farms reporting most noncitrus fruit, tree nut, and berry crops was in the moderate range (65-70 percent of all sales from fruits, nuts, and berries). Specialization by farms reporting citrus crops was much higher, with at least 80 percent of their total sales accounted for by fruits, nuts, and berries.

In 1987, there were 36,718 U.S.farms that reported sales of apple. These farms reported a total of 923,884 acres of fruits, nuts, and berries (table A-1). Apples accounted for 65 percent of all acreage in fruits, nuts, and berries reported by these farms. Sales of fruits, nuts, and berries accounted for nearly two-thirds of the total sales of all agricultural products by the 36,718 farms reporting apple sales, but total acreage of fruits, nuts, and berries represented only 7.5 percent of the total land in farms. The farms reporting apple sales had $1.71 billion of farm production expenses, leaving $386 million in total net cash income from agricultural sales. Net cash income for these apple farms averaged $10,525 per farm.

On average, the net cash income per farm for farms reporting a specific crop ranged from a negative $1,279 for kumquat farms to $188,590 for tangelo farms. In 1987 California data farms had the highest average net cash income among the noncitrus fruits and tangelo farms were the highest among the citrus fruits. Pistachios at $69,582 were highest among the tree nut farms and cranberries at $82,558 were the highest among the berry farms.

Distribution of Net Cash Income by

Farm Size

The average net cash income from agricultural sales varies considerably by size of farm where size is measured by the total market value of agricultural products sold (table A-2). The data show small-size farms (those under $10,000 in sales) on average have negative net cash incomes, while net cash income is positive on larger farms. Frequently, small farms are operated by part-time producers who derive substantially larger proportions of their income from nonfarm sources than do producers on larger farms.

Distribution of Net Cash Income by

Region

Regional differences in net cash income per farm varied by crop and were mixed among the noncitrus, citrus, nut, and berry crop categories (table A-3). Average net cash incomes were higher in the Northeast and North Central regions for apples, tart cherries, pears, and fresh plums and prunes than inthe West or South regions. However, net cash incomes were highest in the West for some fruit crops such as apricots and sweet cherries, but highest for peaches in the South. Net cash income was generally higher for citrus farms in Florida than in California.

Pecans are the only tree nut crop that is grown in many States. Although pecan prices were low in 1987, it is evident from the data that pecan farms in the West, where only improved varieties of pecans are grown, fared better than pecan farms in the Southeast region, where a mix of improved and native pecans are grown. Net cash incomes for berry farms were generally highest in the Northeast region, except for strawberries which were highest in the West.

Sales Concentration of Farms

Data on the structure of fruit and nut farms and the amount of concentration for each crop by farm size, as measured by total agricultural sales, indicated that large farms were relatively fewer in number but accounted for a relatively larger proportion of total acres, or sales, or each specific crop (table A-4). For example, 1.6 percent of the farms reporting apple sales were in the largest size category ($500,000 or more in total agricultural sales), but these farms accounted for 23 percent of the total apple acres (sales). At the other extreme, the smallest farms (those with less than $10,000 in agricultural sales) comprised 66 percent of the total farms reporting apple sales but accounted for only 14 percent of total apple acres (sales).

Prices Received by Growers

The relative net cash incomes shown in this report represent only 1 year (1987) and will change over time, especially as production and prices for the specific fruits vary from year-to-year. Prices received by producers in 1987 for apples, tart cherries, pears, fresh prunes and plums, lemons, and pecans were unusually low, while grower prices for all other fruit and nut crops were near normal (table A-5). That is, most fruit and nut prices in 1987 were near the average for all the years between 1983 and 1991. Cash receipts and, therefore, net cash incomes for farms selling any of the mentioned six crops may have been adversely affected by the low prices received for these six crops in 1987.

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(1) Agricultural Economist, Specialty Agriculture Branch, Commodity Economics Division, ERS.

(2) This exludes farms selling dried raisins.

COPYRIGHT 1992 For more information, contact US Department of Agriculture Economic Research Service. Phone: 1-800-999-6779 (8:30-5:00 ET).

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