USDA's Economic Research Service says global swoon to be easier on farmers than others

What does the global economic crisis mean for American farmers and their communities? While farmland values and commodity demand have declined, the effects have been ameliorated by gains made by farmers in 2007 and 2008, which allowed farmers to start the crisis on "solid financial ground," the Department of Agriculture's Economic Research Service said in a comprehensive report yesterday.

Looking forward, less international demand for exports and declining energy prices will be the two biggest economic factors affecting American agriculture. But "because the U.S. farm sector went into the crisis with record-high exports, prices, and farm income, the declines, although substantial, will bring agriculture back to trend outcomes," the report says.

The largest uncertainty facing agriculture will be the value of the dollar. Despite that unknown, the authors say the industry should be optimistic: "While there is a great deal of uncertainty concerning the full magnitude of the U.S. and global recession, the effects of the crisis are expected to be less severe for U.S. agriculture than for many other sectors of the U.S. economy." (Read the report)