Part I FARMING IN THE UNITED STATES LEVEL OF OUTPUT Total farm output reached a record high level in 1965, 15 percent above the 1957-59 average (Index = 100). Output remained steady in 1963 and 1964, increased sharply in 1965 and then declined to 113 in 1966 as unfavorable weather and a new cotton program restricted crop output. Output of livestock and livestock products recorded a high in 1964 but declined about 2 percent in 1965 and held steady at that level in 1966. Crop output declined in 1964, established a new record high in 1965 and then declined about 3 percent in 1966. Around 60 million acres of cropland were diverted from production under various production adjustment programs in 1966. Farm output has increased 31 percent since 1950 maintaining a slight edge over population which increased 28 percent. CROP PRODUCTION Total crop production in 1964-66 averaged 13 percent above 1957-59. Less than 300 million acres were planted to crops in 1966-the lowest acreage on record. Partly as a result of production adjustment programs, cropland used for crops was down more than 10 percent from the early 50's. However, the sharp upward trend in crop production per acre more than offset the decline in acreage. Production of 6 major groups of crops was higher in 1966 than in 1964, as follows: Feed grain production (total of corn, oats, barley and sorghum grain) exceeded 157 million short tons in 1965 and 1966. This was a record highabout 1 percent higher than the previous record in 1960. Production of food grains (wheat, rice, rye and buckwheat) averaged 44 million short tons in 1964-66, 16 percent above 1957-59. Production adjustment programs were in effect for feed grains, wheat and rice throughout this period. During 1964-66, production of oil crops trended upward and averaged 50 percent higher than 1957-59. Sugar crops were 44 percent above 1957-59, although production in 1965 and 1966 was below 1964. Fruit and nut production averaged 17 percent higher as the result of a steady climb during the three years. Cotton production was more than 20 percent above 1957-59 in 1964 and 1965, but dropped sharply below that average in 1966. Cotton acreage was reduced under the 1966 cotton program, and yields were held down by adverse weather. Tobacco production was nearly 30 percent above the earlier average in 1964 but dropped to 107 percent in 1965 and 1966. Individual crops included in the major groups exhibited considerable variation. Production of corn, the leading feed grain, exceeded 4 billion bushels in both 1965 and 1966. Production averaged 14 percent higher than 1957-59. Production of sorghum grain was up about 10 percent, but barley and oats were down. Harvested acreage of corn was down sharply due to the Feed Grain Program but yields continued to increase sharply. The U.S. average yield of corn for grain was nearly 74 bushels per acre in 1965 and only slightly less in 1966. A decade earlier, U.S. yields of corn for grain averaged 43 bushels per acre. Higher rates of fertilizer use, higher plant populations per acre and other improved practices are among the major factors responsible for this increase. Production of oats continued to decline. Harvested acreage was only about half that of ten years earlier. This more than offset the increase in yields per acre. Barley production was down from the relatively high level of 1957-59 but did not differ greatly from the average of 10 years earlier. Yields were record high in 1965 and averaged nearly 40 bushels for the 3 years. Stimulated by the adoption of hybrid seed, yields of sorghum grain averaged 50 bushels per acre. As recently as 10 years earlier sorghum yields averaged 20 bushels per acre. Production of oilseeds (excluding cotton seed) was 50 percent above 1957-59 and nearly double production 10 years earlier. Production of soybeans reached a new record high of 931 million bushels in 1966. Soybean production in 1964-65 was 55 percent higher than in 1957-59. Increased acreage accounted for nearly all the increase since yields were only fractionally higher. Strong domestic and export demand provide the incentive for continuing increases in production of soybeans. Although peanut acreage was down slightly, sharply higher yields lifted production 45 percent above 1957-59. Production of food grains exceeded 44 million tons in 1965 and 1966 and averaged near that figure for the 3 years. Wheat production averaged 1.3 billion bushels, 11 percent above 1957-59. Higher average yields accounted for the increase. Acreage was much the same. Rice established a new record high production each year and averaged 66 percent higher than in 1957-59. Output was 85 million cwt. in 1966. Larger acreage and higher yields contributed about equally to the increase. U.S. average yield was 4,324 pounds per acre in 1966. Cotton production was 9.6 million bales in 1966, the smallest in 20 years. Harvested acreage was 9.6 million compared with 13.6 million acres in 1965. Reduced acreage resulted from the provisions of the 1966 Cotton Program. Yields averaged 482 pounds per acre. Unfavorable weather and insect infesta tion reduced yields 8 percent from the record high yield of 1965. Yields were still 10 percent higher than the 1957-59 average, however. Tobacco production was 7 percent above the 1957-59 average in both 1965 and 1966. However, this was well below the levels of the previous 3 years, when tobacco production averaged around one-third higher than 1957-59. Tobacco acreage was down from 1957-59 but higher yields were more than offsetting. Production of sugar crops in continental United States was record large in 1964-65 percent above 1957-59. In 1965 and 1966 production was around 39 percent higher than 1957-59. Acreage of sugar beets was 1.2 million in 1966 compared to 1.4 million in 1964. The yield was 17.4 tons per acre and production of beets amounted 20.3 million tons. A total of 519,000 acres of sugar cane was grown for all purposes. Production of cane for sugar and seed averaged 13.8 million tons. This doubled the amount produced in 1957–59. On the other hand, production of sirup averaged 2.7 million gallons, around 25 percent below 1957-59. Production of refined sugar from 1966 continental crops totaled an estimated 3.8 million tons. In addition, Hawaii produced about 1.2 million tons of refined cane sugar. Production of commercial vegetables for fresh market and for processing averaged 19.5 million tons, around 10 percent more than in 1957-59. Vegetables for processing accounted for about 2% of the increase. Among the other vegetables, Irish potato production was up 10 percent and production of dry beans was slightly higher. Production of 20 important fruits averaged 20.3 million tons in 1964-66, 3 million tons higher than in 1957–59. Production of citrus fruits was record high and accounted for 2 of total in 1966. The long-term trend in production of fruits is upward but there is considerable annual variability because of weather and other environmental conditions. LIVESTOCK PRODUCTION Gross production of livestock and livestock products rose to a peak of 113 percent of 1957-59 average in 1964 and then declined to 111 in 1965 and 1966. The poultry and egg group continued to increase rapidly and in 1966 was 28 percent above the 1957-59 average. This was by far the largest increase among the major livestock groups as indicated. The number of cattle on farms January 1, 1967 was 108.5 million, slightly below the all-time peak level of 109 million head reached January 1, 1965. Low point of the current cattle cycle was recorded January 1, 1958 when the on-farm count stood at 91.2 million head. The number of cows and calves kept for milk at 22.9 million was down 9 million from January 1, 1958. The number of beef animals was 85.6 million, an increase of 26 million head. Liveweight production of cattle and calves was 33 billion pounds in 1965 and at least that high in 1966. In 1965 the pig crop of 79 million head was down 10 percent from the below-average level of 1964 and the smallest since 1953. It increased in 1966, but the average for 1964-66 was 10 percent below 1957-59. Production of meat animals combined averaged 12 percent above 1957-59. The peak of 116 was reached in 1964. The number of milk cows on farms continued to decline. The annual average number on farms was 14.5 million, 23 percent below 1957-59. Although milk production per cow continued to climb, this did not offset the decline in cow numbers, and farm production of dairy products in 1966 was 4 percent below the peak level reached in 1964. However, production was still fractionally above 1957-59. Production in the poultry and egg group continued the rapid advance that has been underway with only minor interruptions for two decades. Production in 1966 was 28 percent above 1957-59. This was the fourth successive year that production had exceeded any previous year. Broiler production in 1966 reached 2.5 billion birds which yielded 7.2 billion pounds of chicken meat on a ready-to-cook basis. This was an increase of nearly 50 percent from 1957-59. Production of turkey was 1.7 billion pounds, 56 percent above 1957-59. Production of eggs averaged 5.4 billion dozen in 1964-66, 2 percent below 1957–59. TRENDS IN PRODUCTIVITY AND RESOURCE USE The record volume of farm output during 1964–66 was accompanied by increased productivity as shown: Farm output per unit of total input in 1964-66 averaged 10 percent above 1957-59. The peak of 12 percent above average was reached in 1965. Continued substitution of more productive purchased inputs for nonpurchased inputs enabled farmers to produce more output with only a small increase in total inputs. There have been substantial changes in the composition of inputs however. Farmers have continued to substitute the use of purchased inputs, such as machinery and equipment and fertilizer, for operator and family labor and real estate. This has resulted in increased output per unit of input, but it has increased cash operating expenses and makes farmers more vulnerable to increases in prices paid for purchased inputs. Farm output per man-hour continued to expand and in 1966 was 57 percent above 1957-59. In 1966, 28 percent fewer man-hours were used to produce 13 percent more output. Crop production per acre averaged 20 percent more than in 1957-59. The average for livestock production per breeding unit was up 12 percent. Resources per farm—land, machinery, chemicals and other purchased inputs -continue to increase as technology advances, thus providing more adequate incomes for families who can finance these resources. Many farmers are leaving agriculture and others are supplementing their farm income by nonfarm employment. In 1966 the number of farms was estimated at 3.2 million, down 23 percent from 1957-59. Although this is a continuation of a downtrend in farm numbers that goes back to at least the early 1930's, the rate of decline has been much faster in the last decade or so. There were more than 1 million farms with value of sales of $10,000 or more in 1965. These farms were 30 percent of the total in 1965 compared with 20 percent in 1959. They accounted for more than 80 percent of the total value of farm products sold in 1965. The 1959 percentage was 70. Farms with value of sales of less than $10,000 numbered 2.4 million in 1965, down 28 percent from 1959. These farms, which include part-time and part-retirement farms, declined from 80 percent of all farms to 70 percent. Their contribution to total value of sales declined from 30 percent in 1959 to less than 20 percent in 1965. Family farms-those on which the operator and his family do most of the work-are the dominant type of business within the expanding sector of U.S. agriculture. Adapting to new and improved technology has enabled farm families to handle larger units with available labor. However, these larger units require increasingly larger amounts of capital. Obtaining access to resources required to finance an adequate farming unit can be a serious problem in many cases. Farmers have greatly expanded their output and productivity by using more of the kinds and quality of inputs obtained through the purchase of nonfarm goods and services. Agriculture's increasing reliance on the nonfarm economy is indicated by the continued substitution of nonfarm-produced goods and services for farm labor and land. Thus, improved technology has made it possible to substitute mechanical power and equipment for animal power and labor. The importance of land as an input is diminished by increased use of fertilizers, electric power, pesticides, herbicides, irrigation and other improved practices. Farm output in the United States is expected to rise in the next few years. The rapid rise in productive efficiency is likely to continue. Use of resource inputs other than labor and land is likely to continue to rise and use of labor in agriculture will continue to decline. However, the rate of decline in the use of labor may be less than in the last decade. DEMAND FOR FARM PRODUCTS Domestic demand for farm products continued to match population growth and rising per capita income. Population increased at an average rate of 1.3 percent per year or around 2.5 million people. This rate of increase was somewhat less than in other periods since World War II. Real consumer income per person-income adjusted for direct taxes and price level changesincreased 4.1 percent annually in 1964-66, almost double the annual rate of increase in the preceding three years. The nation's total output of goods and services increased at an annual rate of 5% percent with 4.2 percent during the previous three years. In terms of current prices, per capita disposable income averaged $2,417 in 1964-66, 17 percent higher than the previous three years. Personal consumption expenditures averaged $2,223 per person and were also 17 percent above 1961-63. Consumer expenditures for food (excluding alcoholic beverages) totaled $91.3 billion in 1966, 19 percent above 1963. Higher retail food prices accounted for slightly less than half the increase. More people, a small increase in per capita consumption, and a continuing shift to higher quality and more highly processed foods were responsible for the balance of the increase. Expenditures for food as a percentage of disposable income continued to decline from 18.9 percent in 1963 to 18.1 percent in 1966. The farm value of foods originating on U.S. farms was $28 billion in 1966, 24 percent higher than in 1963. Total use of farm products in 1964-66 averaged 18 percent above 1957–59. |