NORTHERN PLAINS UNITED STATES DELTA STATES MOUNTAIN STATES PACIFIC
REGION
Figure 2. The Decline in Farm Asset Position for United States and Regions, 1980-84. Source: GAO,
p. 26.
fixed assets such as land and large machinery
were bought.
Another measure of financial health for
businesses is the rate of return on equity.
The return for the farm sector has a history
of wide fluctuations, but 1981 was the first
time in the recent past that it was negative,
Figure 4. Both low income and the decline
of farm asset values since 1979 contributed
to this condition.
Changes in farm earnings since 1979 have
had a substantial impact on the nonfarm sec-
tor of the agribusiness economy. Suppliers
of both durable and nondurable farm inputs
have faced difficulties. Firms and organiza-
tions serving the financial needs of farmers
have also felt the impact.
Farm machinery and implement businesses
have been in a depressed condition since the
late 1970s. Unit sales of most large farm
machinery items during 1985 were less than
half the number sold in 1979, Table 3∙ De-
pressed conditions in this business area since
1977 were estimated to have caused losses
of $26.2 billion in total output, 327,000
jobs, and $6.4 billion in personal income
(GAO, ρ. 40).
Fertilizer use during 1985 was down 9∙2
percent from the high of 53 99 million gross
tons sold during 1981. The decline was 8.5
percent on a primary nutrient content basis,
Table 4. During the 4 years from 1982 through
1985, 82.9 million tons of primary fertilizer
nutrients were sold compared with 89 ∙ 9 mil-
lion tons during the 4 years from 1978
through 1981. Thus, average annual con-
Tλble 3. Sales of Selected Farm Equipment, 1979 and
1985
Number of units sold
Item 1979 1985
Tractors, 40+ HP .....................54,728 20,193
Self-propelled combines ........... 5,100 1,436
Balers ....................................... 3,208 1,404
Forage harvesters .......................1,154 423
Mower conditioners .................. 4,266 2,576
Windrowers .............................. 1,234 395
Grinder-mixers ......................... 5,901 923
Corn heads ............................... 2,462 788
Source: GAO, p. 40.
105