More than 30 percent of Minnesota farmers lost money in 2016, according to a new analysis by the University of Minnesota Extension and Minnesota State.
The average Minnesota farm's balance sheets are still strong — mainly because of record corn and soybean yields and farmers banking some surplus dollars from a few years ago — but there are obvious signs of financial stress, said Extension Economist Dale Nordquist.
Nordquist said there are always some farmers that struggle to stay in business, but the number in that category grew larger again last year.
"Those extra bushels in the bin saved many of our [corn and soybean] farms from near disaster," said Ron Dvergsten, a farm management instructor at Northland Community and Technical College in Thief River Falls.
But many farms are now "on the edge" going into 2017, and some have had trouble getting operating credit from lenders, he said.
Requests have increased to the extension-run Farmer-Lender Mediation program, where debtors and creditors negotiate with a mediator, Nordquist said, and many farms have turned to restructured equipment or land debt to lengthen payoff terms and free up cash flow.
"When you get down to the bottom end of the scale, 30 percent of the farm operations were minus instead of plus" in terms of net income, he said.
Across the board, from crops to livestock and dairy, farms in 2016 were dealing with lower prices for the second year in a row.