1. The Emerging Role of Agriculture in Economic Development
Rex Ricketts, Director
University of Missouri Extension Commercial Agriculture Program
Commercial Agriculture Program 1

2. Overview Importance of Missouri's Agriculture
Historical Changes in Agriculture
Tractor
Electricity
Trailer Truck
Economic Impact of Animal Production 2

3. Missouri Agriculture 2006 $5.62 billion in farm receipts 55% livestock
45% crops
Missouri ranks 2nd in the US in the number of farms
105,000 farms
Source: USDA-NASS 3

4. Missouri Livestock Receipts - 2005 $3.1 billion
Source: USDA-NASS 4

5. What technology has changed agriculture the most?
Tractor
Electricity
Trailer Truck
Bio Fuels 5

6. Number of U.S. Farms
Source: USDA-NASS 6

7. Number of U.S. Tractors
Source: USDA-NASS 7

8. Number of U.S. Farms with Electricity
Note: The use of electricity on farms after 1954 was so widespread throughout the states that there seemed no need to obtain further information
Source: USDA-NASS 8

9. Number of U.S. Tractors, Farms and Farms with Electricity
Thousands of Farms 9

10. Trailer Trucks 10

11. One Trailer of Market Hogs
53,000 lbs. live weight
200 hogs
10,000 pork chops 11

12. One Trailer of Milk 50,000 lbs. of milk 5,813 gallons of milk
93,000 8 oz. glasses of milk
5,000 lbs. of cheese 12

13. 600 Sow Farrow to Finish (25-ton Truck Lots)
Weekly
Annual
Market Hogs 2
104
Corn
3.7
194
Soybean Meal
1.1 58
Supplement
0.12 6
Total
6.9
362 13

14. 700-cow Dairy (25-ton Truck Lots)
Weekly
Annual
Milk 7
365
Feedstuffs (includes Corn Silage, Alfalfa Silage, Alfalfa Hay, Grass Hay, Corn, Soybean Meal, Cotton Seed and Mineral/Vitamins
10.5
507
Total
17.5
872 14

15. Economic Impact of Animal Agriculture15

16. 2,400-head Contract Finishing Unit
Swine Construction Economic Impact
Construction Cost = $520, (includes buildings, manure storage and water supply)
Overall construction project cost will be $520,000. These costs represent investments in construction of buildings, manure storage and water supply. A significant portion of these dollars will be spent locally for contractors, specialized labor, and building supplies for constructing the operation. 16

17. 2,400-head Contract Finishing Unit
Farm level annual economic impact
$122,000 in gross revenue to swine operation including contract payments and manure value
$3,500 spent on real estate and property taxes
$5,000 spent on utilities
500 acres needed for feed (corn)
320 acres for manure application in corn soybean rotation
$50 per acre fertilizer value
$207,000 in annual economic activity state wide (multiplier effect) 17

18. 700-cow Dairy Operation Dairy Construction Economic Impact
Construction Cost = $2,483,000 (includes milking parlor, freestall barn, holding area, bunker silo, manure storage and water supply)
Dairy machinery needed = $250,000
Overall construction cost will be $2,483,000. These costs represent investments in construction of a milking parlor, freestall barn, holding area, bunker silo, manure storage and water supply. Additionally, at least $250,000 worth of machinery will be purchased for the dairy operation. A significant portion of these dollars will be spent locally for contractors, specialized labor, building supplies for constructing the dairy and for purchasing equipment. 18

19. 700-cow Dairy Operation Farm Level Annual Economic Impact
$2.4 million in gross revenue to dairy
$6.0 million in economic activity (multiplier effect)
$10,000 spent on real estate and property taxes
$60,000 spent on utilities, fuel and oil
11 full-time positions created ($260,000 in labor expenses)
1,466 acres needed for feed (corn silage, alfalfa, etc.)
At least 1,626 acres needed for nutrient management
$32 to $56 per acre fertilizer value
The dairy will generate at least $2.4 million in gross revenue per year for over the next 20 or more years An estimated six million dollars in economic activity will be generated annually in the state due to the multiplier effect of the annual expenditures of the dairy. Most of that economic activity will be generated in the surrounding rural area. For every dollar spent by the dairy, approximately $2.50 in business purchases and wages are created in the state’s economy. The dairy will generate $10,000 per year in real estate and property taxes. The dairy will spend $10,000 per year in insurance fees The dairy will spend $60,000 per year in utilities, fuel and oil The dairy will provide direct employment to 11 full-time positions such as a dairy manager, herdsman, milkers, feeders and others. Total labor expenses including benefits for the dairy operation will be $260, Indirect jobs in the community supported by dairy operation include: equipment repair and maintenance, insurance, banking, custom manure hauling, dairy supplies, and veterinary services. The dairy will provide local crop producers with a new market for their crops; total crop acreage needed for the dairy will be 1,466 acres. Corn silage, alfalfa silage, alfalfa hay, grass hay and corn will be needed to supply feed to the dairy. Nutrient management from the dairy will help local landowners save $19 - $73 per acre in reduced fertility costs by the use of dairy manure. A minimum of 1,626 acres will be needed for accepting manure 19

20. Multiplier Effect of Missouri’s Livestock Sector 2005
Cash Receipts
Additional Impact
Total
-- Millions of dollars --
Beef
1.2
1.1
2.3
Poultry
971 ?
Pigs
616
484
Dairy
298
631
929 20

21. Biofuels Industry 21

22. Annual Operation Impacts of the Four Ethanol plants (160 MGY)
Category
Direct
Indirect
Induced
Total
Employment (jobs)
161
2,146
715
3,022
Labor income (million dollars)
$20
$73
$27
$121
Value added (million dollars)
$36
$130
$50
$215
Net total output (million dollars)
$285
$192
$45
$522
Tax revenues at the federal, state and local level - $43 million
Corn Used in Production – 56 million bushels
Golden Triangle Energy, LLC. Craig, Missouri 22

23. Yearly Operating Expenses for Ethanol Plants
Purchases
Current Production
500 MGY
800 MGY
Corn
$126 million
$592 million
$942 million
Natural gas
$40 million
$132 million
$212 million
Electricity
$5 million
$17 million
$27 million
Enzymes and chemicals
$15 million
$50 million
$82 million
Repairs and maintenance
$6 million
$19 million
$31 million
Labor
$8 million
$28 million
$45 million
Water
$2 million
$10 million
Depreciation
$14 million
$43 million
$70 million
Other
$24 million
$75 million
$120 million
Total operating expenses
$241 million
$961 million
$1.5 billion 23

24. Why agriculture has changed
Conclusions
Why agriculture has changed
Animal agriculture is an important economic contributor to Missouri’s economy
Animal agriculture faces new opportunities and challenges with the growing biofuels industry 24

25. The Emerging Role of Agriculture in Economic Development
Rex Ricketts, Director
University of Missouri Extension Commercial Agriculture Program
Commercial Agriculture Program 25