Mar. 23—NORTH MANKATO — After years of low crop prices, those in agribusiness say a rebound in commodity prices has spurred a bright outlook for the rural economy.
The low prices were fueled by a glut of grain, but strong export demand and dry weather have pushed corn and soybean prices to their highest levels since 2014.
That was one of the findings from an annual survey of farmers and others in agribusiness.
GreenSeam, a division of Greater Mankato Growth, released the annual State of Ag report Tuesday during an event at Mankato Brewery.
The report was based on questions asked of eight focus groups from all regions of the state, with participants discussing the past year and what they expect in the next year or so.
"You will notice the presence of resilience," said Sam Ziegler, director of GreenSeam.
Thom Petersen, Minnesota Department of Agriculture commissioner, told the group that things began turning around last fall when high yields and higher crop prices coincided.
"It was a good perfect storm," Petersen said.
But he said last spring was filled with uncertainty and bad news.
"Think about a year ago at this time." Petersen said COVID caused a major decline in exports and hammered the livestock industry, particularly pork and turkey, as restaurants, schools and other facilities closed.
"We'd gone from eating out 50% of the time to eating at home 80% of the time."
Andrew Herr, president of GAT Farms, owned by Glen Taylor, said they are bullish on increased innovation and organic ag to fuel growth into the future.
Herr said GAT Farms, which has a $75 million annual payroll in southern Minnesota and Iowa, has set a goal to boost organic operations.
He said there are a number of challenges to overcome to reach the goal. One limiting factor they found was the use of traditional nitrogen on farmland. Herr said GAT Farms has partnered with entrepreneurs and startups to produce organic nitrogen from dried animal waste.
More respondents than last year believe the state of ag is heading in the right direction, and more than half of surveyed businesses are looking to hire additional employees.
Nearly a quarter of respondents said they believe immigrant workers are an important factor in allowing them to grow their business.
An overwhelming 92% of those surveyed said they believe the state of agriculture is headed in the right direction, up from just 16% the previous year. Ziegler said data showed strong yields and good crop prices are leading reasons for the positive outlook, along with advances in innovation and sustainability.
Forecasting the change of their business in the next year, 60% reported they foresee growth, while only 12% think their business will decline.
The biggest threats to business growth were seen as increased regulation, lack of potential employees and taxes. Businesses with more than 100 employees did not indicate taxes as a top threat.
Just over half of the respondents said COVID-19 had a negative impact on their business, but some indicated some positives, such as not having travel expenses and saving money with employees working from home.
Participants held mixed feelings regarding the sustainability of ag practices for the foreseeable future. Some praised the increased interest and technological advances made in the area, while others believed there is still much to be done in creating sustainable practices.
"Although progress is being made in the realm of sustainability and solid economic vision, marketing and advertising tends to push sales for the sake of retailer profit above farmers and environmental interests," said one respondent.
New to this year's survey were a couple of questions about entrepreneurship. More than 60% of respondents have seen an increase in people in agriculture engaging in gig work or side jobs to supplement income. The top types of gigs included construction, trucking, factory work and food service.