Economic and Marketing INFORMATION
FOR
INDIANA
FARMERS
Farm Account Cooperators Fare in J955?
by  F.  V.  SMITH,  Agricultural  Economics
NET FARM INCOMES of Indiana
farm account cooperators averaged $3,446 in 1955 compared with
$8,373 in 1954, a decrease of 59 percent. The average net cash income in
1955 was only 15 percent lower than
in 1954 ($6,000 compared with $6,-
994). However, in 1955 a net decrease of $2,325 was recorded in the
inventory values of livestock, feed,
machinery,    and    improvements.    In
1954 the net inventory increase was
sl.570 (Table 1).
About three-fifths of the average
inventory decrease in 1955 was in
feed and grain and about two-fifths
in livestock, mostly hogs. The average rate   earned   on   investment   in
1955 (1.3  percent)   was  the  lowest
since 1932.
Earnings Not Representative of
All  Farms
Average earnings of account co-
operators do not represent average
earnings of all farmers in Indiana.
Account cooperators' farm units,
»nich averaged 261 acres, were more
than twice as large as the average
farm in the state recorded by the
census. Also, most farmers who are
interested in an analysis of their farm
words operate their farms more efficiently than the average farmer. In
addition, on farms where part or all
°i the farm unit was rented, the investment, income, and expenses of
h»>th owner and renter were included
,n the summary of the farm unit.
why Were Earnings Lower in 1955?
'he sharp drop in farm earnings
111 1955 resulted mainly from lower
J-'rain and hog prices and a decrease
"'the end-of-year  inventory  values
able 2). These decreases were not
""set by higher dairy and poultry
Product prices. No significant differ
ences showed up in the quantities of
either grain or livestock produced
on cooperators' farms in 1955 compared with 1954.
With lower grain and livestock
prices in 1955 the larger livestock
farms, in general, did not have the
advantages in farm earnings that usually are obtained from a larger volume of business.
Earnings in 1955 by Areas, Types
of Farms
Compared with 1954. cooperators'
average labor incomes in 1955 were
$3,539 lower in the northern area.
$6,569 lower in the central area, and
$2,067 lower in the southern area of
the state (Table 3). On the average,
more grain, hogs, and beef cattle
were produced on the central area
farms than in either of the other two
Table 1. Average Earnings of Indiana Farm Account Cooperators in 1955
Compared  With Recent Years
1955
1954
1953
1952
1951
1950
Cash   income
$22,227
$24,458
$23,253
$21,758
$20,526
$17,373
Cash   expenses
16,227
17,464
15,313
15,485
15,233
12,495
Net  cash   income
6,000
6,994
7,940
6,273
5,293
4,878
Net  inventory  change
-2,325
1,570
269
139
3,907
3,717
Net   farm   income'
3,446
8,373
8,010
6,211
8,947
8,405
Labor  income-
S -353
$ 4,567
$ 4,379
5 2,634
5 5,668
$ 5,914
Rate  earned  on   investment"
1.3%
7.7%
7.6%
5.3%
10.2%
12.9%
Number    of    farms
517
544
561
564
587
599
Acres    per    farm    unit
261
257
248
238
227
224
Average    capital    investment
575,986
$76,122
S72,618
$71,549
$65,588
$49,828
Farm    price    index1
219
258
264
279
299
254
Index   of   prices   paid'
281
281
279
286
281
255
'Net   cash income    plus   (or   minus)    inventory    changes    minus    value    of    unpaid   family    labor.
-Net   farm income   minus   5   percent   interest   on   the   total   capital   investment.
•'Net  farm income   minus  the  wage  charge  for  the  operator  divided   by   the  total   capital   investment.
'Index   of prices   of   Indiana   Farm   Products   (1910-14 = 100).
"Index   of prices   paid   by   U.   S.   Farmers   (1910-14 = 100).