Organic Production Proves Profitable in Upper Midwest

Despite smaller sizes and inflation effects, organic row crop and dairy farms in the Upper Midwest have shown strong profitability and remained competitive compared to conventional counterparts in 2020 and 2021. Minnesota and Wisconsin organic row crop producers managed 325 acres per farm on average and generated $324.24 per acre in median net farm income in 2020 and 2021. Conventional row crop farms, by comparison, were more than three times as large; averaging 1,053 acres per farm while netting $144.65 per acre in median farm income.

Meanwhile for organic dairy farms, profits remained positive despite a 10% increase in direct and overhead expenses from 2020 to 2021. Feed accounted for the largest share of increased costs due to the significant spike in organic grain prices. Similar organic dairy and crop and dairy farms financial performance data is available from a new University of Minnesota report, 2020-2021 Organic Farm Performance in the Upper Midwest: Whole Farm and Enterprise Reports.

The report includes whole farm and enterprise returns as well as traditional financial indicators for organic and organic transition row crops and dairy in Minnesota and Wisconsin. Data for the report comes from the Farm Business Management (FBM) programs in each state as part of a UMN-led benchmarking project in collaboration with the Minnesota State Agricultural Centers of Excellence and the Center for Farm Financial Management. The project is funded by the USDA Organic Research and Extension Initiative Program.

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Scholarships are available through the project to partially off-set FBM programming and tuition costs for certified and transitioning organic farmers. Learn more about the organic benchmarking cost share program and apply for scholarships online. Find organic reports from previous years and read the full press release online. Contact Gigi DiGiacomo (gigid@umn.edu) with any questions.