UGA economist talks with WALB on Ga. agriculture economy
ALBANY, Ga. (WALB) - Dr. Jeffery Dorfman, a state fiscal economist with the University of Georgia, talked with WALB’s Jim Wallace Wednesday concerning the status of the State of Georgia’s agriculture economy going into 2022.
“So right now the state agriculture economy is in good shape financially in the sense that farmers don’t have excessive debt. Interest rates are pretty low, and most have got some money in the bank. But for the most part, farmers are trying to ride out the period of very high inputs. Costs. And just try to get through 2022 and hope things will be better in 2023,” Dr. Dorfman said.
Wallace replied, “as people head to the stores, obviously they see prices are up and of course the price of the inputs. Just about everything a farmer uses, the price is up.”
“That’s right. Most, a lot of input prices are up 30 to 40%. Fertilizers are up in a lot of cases 100%. About the only thing that is getting better now is transportation costs are coming down a little. Particularly container shipments. But for the most part input prices are very high. And food processing prices are very high, transportation costs are high. So by the time they get on the shelf, it’s much more expensive.”
“And even though the food is expensive, does the grower end up with more profit because of that?” Wallace questioned.
“So grower profits are down because input costs are up so much. Commodity prices are at decent levels, but they have not gone up anywhere near as much as input costs. So farmers’ margins have been squeezed. And they are getting a little less of the food dollar. Processors and grocery store costs have gone up, in some cases even more than farmers because they are having to put in protective equipment for COVID and dealing with a lot of sick workers,” answered Dorfman.
Since agriculture is such a huge part of Georgia’s economy, what does that mean for the state in the next year?
“Well, the good news is agriculture went into this in good financial shape, so we can ride this our for the next year. Farmers are not likely to make a lot of money in the next year, but you won’t see farmers going broke for the most part either. I think farmers can ride this out and there’s enough other money in the system. I think the state’s economy is doing very well and will continue to do just fine,” said Dr. Dorfman.
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