OU 315/td>January 14, 1997

SOUTH CAROLINA FARM INCOME PROSPECTS:
1997 AND BEYOND

H.M. Harris, Jr.
Extension Ag Economist

Last year at this time, we projected a 12-15 percent increase in S.C. farm income for 1996. However, at that time prospects for the crops sector appeared to be much brighter than for the livestock sector, which was suffering from low output prices and high feed prices. Preliminary indications suggest that our forecast was right on target. And as it turns out, even in the livestock sector cash receipts were fairly strong, led by higher milk and hog prices, and continued poultry expansion.

The most often asked question last year was, "how long will the grain price boom last?" Our unequivocal response was "...probably not long," and we urged aggressive marketing, including the 97 crop. In general, we repeat that guidance now. It's over! Still, 1997 could show further growth in farm income despite lower grain prices. Income prospects for tobacco (higher production) and hogs (higher prices) look particularly bright in 1997. Soybeans, coming off a record yield, also have potential. Beef prices will probably at long last begin a recovery that should last into the next century.

Looking Further Ahead. The 1996 Farm Bill is likely to have a profound impact on South Carolina agriculture through 2002. The bill provided a windfall gain for agriculture last year -- a fixed market transition payment atop record high grain prices.

Farm prices will become much more volatile, whereas market transition payments will phase down. Major regional shifts in production may occur. Farm income will become even more dependent on the world market, and exports tend to fluctuate much more than domestic demand. Successful producers in this new policy environment will be those who are able to manage risk. 



                          CASH RECEIPTS
       Farm Marketings by Commodity and Government Payments
             South Carolina, 1993-1995, 1996 Forecast
===================================================================== 
     Commodity          1993         1994         1995      1996
=====================================================================
                                 --Thousand Dollars--
CROPS:
 Tobacco             185,612        171,687     188,896    209,000
Oil Crops:
 Soybeans             67,248         60,437      85,023      95,000
 Peanuts               6,983          9,933       9,178      10,000
Feed Grains:
 Corn                 26,589         36,400      49,425      55,000
 Hay                   6,036         10,299      10,625      10,000
 Oats                  1,001          2,233       1,517       2,000
Food Grains:
 Wheat                29,797         51,280      36,796      55,000
Cotton:
 Cotton Lint          58,600         120,642     142,314    158,000
 Cottonseed            4,770           6,785       6,587      7,000
Vegetables:           86,000          91,000      63,000     80,000
Fruits and Nuts:
 Peaches              27,570          35,640      34,240      5,000
 Pecans                2,234           7,002       3,315      5,000
 Apples                6,814           7,425       6,940      6,000
 Other Fruits & Nuts   3,220           3,544       3,277      4,000
Miscellaneous Crops:
 Greenhouse/Nursery  127,745         144,998     155,060     170,000
 Forest Products      10,400          11,400      12,000      12,000
 Other Crops           6,045           8,418       8,483       8,000
______________________________________________________________________________
TOTAL CROPS          657,234         777,051     817,814     881,000
______________________________________________________________________________
LIVESTOCK AND LIVESTOCK PRODUCTS:
Milk                  59,887          60,745      55,304      62,000
Meat Animals:
 Cattle and Calves   132,958         123,414      91,697        90,000
 Hogs                 72,143         60,315       56,579        65,000
Poultry and Eggs:
 Eggs                 69,442         70,389       70,680        70,000
 Broilers            169,752        206,080      234,738       250,000
 Turkeys              74,172         69,136       75,778        90,000
Other Livestock       23,000         24,000       26,000        25,000 
______________________________________________________________________________
TOTAL LIVESTOCK      601,155        615,038      610,983       652,000
TOTAL COMMODITIES  1,258,389      1,392,089    1,428,797     1,533,000
GOVT. PAYMENTS       102,500         60,200       33,800        60,000
 STATE TOTAL       1,360,889      1,452,289    1,462,597     1,593,000
==============================================================================

THE CLEMSON UNIVERSITY COOPERATIVE EXTENSION SERVICE OFFERS ITS PROGRAMS TO PEOPLE OF ALL AGES, REGARDLESS OF RACE, COLOR, SEX, RELIGION, NATIONAL ORIGIN, OR HANDICAP AND IS AN EQUAL OPPORTUNITY EMPLOYER.
COOPERATIVE EXTENSION WORK IN AGRICULTURE AND HOME ECONOMICS--STATE OF SOUTH CAROLINA, CLEMSON UNIVERSITY, U.S. DEPARTMENT OF AGRICULTURE, AND SOUTH CAROLINA COUNTIES COOPERATING.

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