The attached two-page spreadsheet provides a quick analysis of 2023 grain farm data for Kentucky, compiled by the Kentucky Farm Business Management program from 192 farms. 

Crop Yields on Page 1 were higher than average for all crops.  For all but corn, yields were as high as those experienced in 2021. 

Crop Returns per Acre is the value of this year’s production sold, fed, and held in inventory.  Returns were lower than previous years, but higher than average.  

Much of the decrease in Crop Returns per Acre is due to lower commodity prices received (see Page 2). Prices received for crops produced in 2023 were above average but lower than the year before.  Wheat prices received were down $1.08/bushel - a 13% drop. Corn prices received were down $1.43/bushel - a 22% drop.

Net Farm Income (NFI) on Page 1 was significantly lower than previous years and is the lowest seen in the past five years.  NFI was 59% of the five year-average and only 36% of the 2021 record high.  Note that 28% of KFBM crop farms experienced a net loss in 2023.

Lower Crop Returns and higher operating expenses contributed to lower NFI profitability.  The Ratio of Operating Expense to gross income was 78%.   That is, operating expenses took $0.78 of every $1.00 of gross income earned.  Compare this to 2021, when operating expenses were only $0.36 for every $1.00 of gross income.  The table on Page 2 shows that two key expense categories - Seed, Chemical, and Fertilizer Total and Cash rent - increased by 3% over last year.

Other Financial Ratios on Page 1 show the financial condition of the average KFBM grain farm to be sound.  Long-term solvency (Debt/Asset Ratio) is well below the maximum 30% considered good for crop farms.   Short-term liquidity (Working Capital Ratio) is above the desired ratio of $2.00 of working capital to every $1.00 of current liabilities.

Family Living Expenditures for KFBM farm families that record expenses are shown on Page 2.  The average $88,552 Total Family Living is 72% of the family’s Net Farm Income.  That leaves 28% of NFI available for principal payment and retention by the farm. Note that the percent of NFI used by Total Family Living increases with NFI.  Family living takes 82% of NFI for the High 1/3 of farmers.