BOISE — Strong commodity prices and a booming dairy industry contributed to a record year for Idaho agriculture producers in 2021.

Farm cash receipts were up 8 percent for the year, to $8.8 billion. That included all-time revenue records for potatoes, beets, hay and cattle/calves sales, as well as a near-record for milk.

“Idaho ag is big, and it’s growing,” said University of Idaho economist Garth Taylor.

Taylor gave his annual “Financial Condition of Idaho Agriculture” presentation to the Senate Agricultural Affairs Committee on Feb. 8.

He noted that milk sales alone accounted for 35 percent of Idaho’s farm cash receipts in 2021. Milk and livestock together accounted for more than half the state’s farm sales. When hay and other livestock feed crops are added in, he said, the dairy and livestock industries accounted for about three-quarters of Idaho’s ag industry receipts.

Overall, Taylor said, agribusiness — including producers and processors — accounts for about 17 percent of statewide sales, 12 percent of jobs and 12.5 percent of Idaho’s gross domestic product.

That ranks fifth nationwide in terms of agriculture as a percentage of statewide GDP, he said, behind South Dakota, North Dakota, Nebraska and Iowa.

California’s agriculture industry is the largest in the nation, Taylor said, but not as a percentage of state GDP.

The dairy industry is driving much of the growth in Idaho’s agricultural economy, he said. Inflation-adjusted dairy receipts increased more than 200 percent from 1997 to 2020, compared to 60 percent for Idaho agriculture as a whole.

Taylor noted that 20 dairy farms produce more than half the milk sold in Idaho.

The dairy industry “is very concentrated,” he said. “It creates economies of scale. That’s what you’re seeing in a lot of these statistics. It’s not teeny tiny little farms that create the huge wealth in agriculture. It’s just not that way.”

Net farm income in Idaho is up 150 percent since 1997, Taylor said, compared to just 20 percent for the U.S. as a whole.

However, inflation has been hitting the industry hard in the past year, and that’s expected to continue for at least another year.

“I received record hay prices this year, but I also (paid) record fertilizer prices,” said Senate Agricultural Affairs Chairman Van Burtenshaw, R-Terreton. “So by the time we take care of expenses, it’s like every other year.”

The U.S. Department of Agriculture recently projected that U.S. farm cash receipts would increase 6.8 percent this year, while net farm income drops 4.5 percent.

The good news for Idaho, Taylor said, is that the agency expects dairy income to be up 50 percent.