U.S. Agriculture Production Costs Sharply Decline in 2015

U.S. farmers spent $362.8 billion on agricultural production in 2015, down 8.8 percent from 2014, reversing a long-term trend of growing costs, according to the Farm Production Expenditures report, published this week by the U.S. Department of Agriculture's National Agricultural Statistics Service. 

Feed and farm services, the two largest expenditure categories for U.S. farmers in 2014, both declined 8.2 percent last year. Producers spent $58.5 billion on animal feed, and $41.6 billion on farm services in 2015. One of only two expenditure categories that increased last year was livestock, poultry and related expenses, on which the producers spent $45.4 billion last year, an increase of 0.7 percent from 2014. The other was miscellaneous capital expenditure at $700 million, an increase of 16.7 percent. 

Unlike the previous years, in 2015, the livestock sector accounted for the larger portion of the production expenditures. Livestock producers spent $182.6 billion, down 6.6 percent from 2014. Crop growers spent $180.3 billion, down 10.9 percent from 2014. 

Per farm, the average expenditures total $176,181 compared with $191,500 in 2014, down 8 percent. Last year, an average U.S. farm spent $28,408 on feed, $22,047 on livestock, poultry and related expenses, $20,202 on farm services and $15,443 on labor. 

Regionally, the largest decrease was in the U.S. Midwest region, where agricultural production expenditures decreased by $11 billion since 2014. Total expenditures by region in 2015 are:

• Midwest $113.1 billion
• Plains $93.5 billion
• West $74.9 billion
• Atlantic $44.2 billion
• South $37.1 billion

The Farm Production Expenditures summary provides the official estimates for production input costs on U.S. farms and ranches. These estimates are based on the results of the annual Agricultural Resource Management Survey conducted by NASS. The entire summary is available online at http://bit.ly/FarmExpenditures.