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Farm Expenses

Massachusetts Agricultural Census 2012

Between the years 1974 and 2007 there was an increase of 197.43 percent in the total production expenses of farms in Massachusetts, and a 73.91 percent increase in the average production expenses per farm. Between 2002 and 2007 the total farm production expenses increased 26.49 percent, while the average farm production expenses decreased slightly by 0.05 percent. As shown above, there was an increase in the number of farms in Massachusetts while in general the size of the farms has decreased. Between 2002 and 2007, farmers spend less per farm, on average, on supplies and other inputs due to the reduced land in their farms.  However, between 2007 and 2012, both average farm production expenses and total farm production expenses increased for Massachusetts farmers.  Total farm production expenses increased from $461 million in 2007 to $539 million in 2012, while the average farm production expenses increased from $60,000 per farm to $69,545 per farm.

Figure 4.6 illustrates the total amount spent by Massachusetts farmers, a measure of economic activity that stimulates the Massachusetts economy. That economic activity was $539.3 million in 2012, an increase of nearly 17% over the 2007 level of $461.5 million. Total farm production expenses increase by 114.4 percent between 1987 ($251.5 million) and 2012. Total production expenses increased due to changes in the mix of agricultural products produced, changes in input prices and changes in the number of farms. Figure 4.8 reflects all these changes, including increases in the number of Massachusetts farms. As shown above, there was an increase in the number of farms in Massachusetts while the size of the farms has decreased. More farms means greater contributions to the Massachusetts economy. Smaller farms may also mean greater expenses per farm as there are often farm economies of size.

To eliminate one of these factors (changes in the number of Massachusetts farms) we show average farm production expenses in Figure 4.7.  The average Massachusetts farm spent $40,460 in 1987. By 2012, that figure had increased by near 72 percent to $69,545. While expenses per farm remained stable between 2002 and 2007, the 2012 level represents an increase of nearly 16 percent. These changes are due to input price increases, but also reflect changes in the mix of agriculture between the 2007 and 2012 Agricultural Censuses. The size of the farms has decreased in Massachusetts, and if there are economies of size in farming, smaller farms would have greater expenses per farm. But, the mix of agricultural products has also changed and these changes affect expenses per farm. 

Which counties have the greatest agricultural contributions to the Massachusetts economy?  Figure 4.9 shows total production expenses by county for the Census years 2002 – 2012. Plymouth County led the way in 2012 on the strength of its fruits, tree nuts and berries production, primarily cranberries, with more than $91.9 million in expenses. Middlesex contributed $81.9 million with a majority of those expenditures due to nursery, greenhouse and floriculture production. Other top counties include Worcester ($68.7 million), Franklin ($61.7 million), Hampshire ($44.8 million) and Bristol ($44.3 million), where agriculture is much more diverse.

The largest proportionate increase in total farm production expenses from 2007 to 2012 was observed in Dukes County where expenditures nearly doubled. Barnstable County and Plymouth County expenditures increased by 51 percent and 42 percent, respectively. Other counties saw increases in the 20-27 percent range, with total expenditures falling in Nantucket and Worcester Counties.

Figure 4.10 shows how expenses per farm differ across counties. Expenses per farm differ according to the agricultural production mix across the counties. Expenses also differ according to locational differences in input costs especially labor, land and taxes.  Unusual differences across counties and between years may reflect product changes and/or entrances or exits from production. With small numbers of farms, counties like Dukes and Nantucket can show dramatic changes due to changes in the mix of products produced, or with the entrance or exit of just one or two farms. We do see some substantial increases in costs per farm from 2007 to 2012, especially in the eastern counties.