Farm financial trend in Missouri and its future implications

Abstract

This paper reviews the current and future implications of the recent farm financial problems of Missouri for the rural and state economy. To provide a backdrop against which the current and future financial situation may be assessed, the paper first looks at the farm income trends of the state for the period 1964–1985. Although the level has dropped drastically since 1982, the study found that net income had increased significantly for most of the study period.

However, the trend in farm debt shows that between 1974 and 1982, total farm debt of Missouri farmers almost tripled. In fact, the farm financial situation in the state deteriorated faster than did farm financial situations in the nation. As a result, Missouri was the leader in the number of farm bankruptcies in the nation in 1985.

The paper shows that, since the full-time family farms make up over seventy (70%) percent of the state's total farm, the greater financial problems, resulting in farm losses, occurred in these groups of farms, which are the source of the economic and social health of rural Missouri. It then indicates the serious effects that this wave of farm failures, which amounts to a depopulation of farms and farm families, has on the social and economic structure of rural communities, cheap but reliable food supply system, and competition within the farm sector.

To keep the farm sector competitive and for the family farm to survive, the paper identifies the need for innovative policies (and suggests some), and for the cooperation and coordination of efforts among different agencies and organizations in the country.