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Economic Contribution of the Soybean Industry to the North Dakota Economy

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  • Bangsund, Dean A.
  • Olson, Frayne E.
  • Leistritz, F. Larry

Abstract

The purpose of this study was to measure the economic contribution of the soybean industry to the North Dakota economy. Expenditures and returns from soybean production, grain handling, and transportation were estimated to calculate the direct economic impacts from soybean activities. Secondary economic impacts were estimated using the North Dakota Input- Output Model. Soybean production in North Dakota has trended upward over the past three decades. Increases in acreage were relatively modest in the 1980s, but by the mid 1990s acreage was beginning to rapidly expand. In 1990, North Dakota had about 500,000 acres of soybeans. By 2000, acreage had increased to 1.9 million acres. By 2009, soybean acreage in the state was approaching 4 million acres. Direct impacts (expenditures and returns) from soybean production averaged $312 per acre or $1.1 billion annually from 2007 through 2009. Average direct impacts from handling soybeans at North Dakota elevators were estimated at $27.5 million annually. Transportation of soybeans to market destinations was estimated to generate $49.8 million in annual direct impacts to the state. Total direct impacts from soybean production, grain handling, and transportation were estimated at $1.2 billion annually. Total annual economic impacts (direct and secondary effects) from soybean production, grain handling, and transportation were estimated at $3 billion, $75.9 million, and $129 million, respectively. The total annual economic impact from all soybean activities was estimated at $3.2 billion. Soybean industry activities supported 11,400 full-time secondary jobs in North Dakota. Soybean activities were also responsible for $85 million in combined property tax, sales tax, individual income tax, and corporate income tax revenues. Based on comparison to economic impact estimates from the 1996 through 1998 period, the economic contribution of the soybean industry in North Dakota increased by $2.4 billion or by 306 percent in real terms. Much of the increase in the gross business volume of the industry has come from a three-fold increase in soybean production combined with higher crop prices, handling margins, and transportation rates.

Suggested Citation

  • Bangsund, Dean A. & Olson, Frayne E. & Leistritz, F. Larry, 2011. "Economic Contribution of the Soybean Industry to the North Dakota Economy," Agribusiness & Applied Economics Report 100396, North Dakota State University, Department of Agribusiness and Applied Economics.
    • Handle: RePEc:ags:nddaae:100396
    DOI: 10.22004/ag.econ.100396
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    References listed on IDEAS

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    1. Coon, Randal C. & Leistritz, F. Larry & Hertsgaard, Thor A. & Leholm, Arlen G., 1985. "The North Dakota Input-Output Model: A Tool for Analyzing Economic Linkages," Agricultural Economics Reports 23304, North Dakota State University, Department of Agribusiness and Applied Economics.
    2. Leistritz, F. Larry & Sell, Randall S. & Bangsund, Dean A., 1994. "Economic Contribution of the Wheat Industry to the Minnesota Economy," Agricultural Economics Reports 23303, North Dakota State University, Department of Agribusiness and Applied Economics.
    3. Leistritz, F. Larry & Bangsund, Dean A., 1995. "Economic Contribution of the Wheat Industry to the North Dakota Economy," Agricultural Economics Reports 23291, North Dakota State University, Department of Agribusiness and Applied Economics.
    4. Leistritz, F. Larry & Bangsund, Dean A., 1995. "Economic Contribution of the United States Sunflower Industry," Agricultural Economics Reports 23216, North Dakota State University, Department of Agribusiness and Applied Economics.
    5. Bangsund, Dean A. & Leistritz, F. Larry, 2005. "Economic Contribution Of The Wheat Industry To North Dakota," Agribusiness & Applied Economics Report 23537, North Dakota State University, Department of Agribusiness and Applied Economics.
    6. Bangsund, Dean A. & Leistritz, F. Larry, 1998. "Economic Contribution Of The Sugarbeet Industry To North Dakota And Minnesota," Agricultural Economics Reports 23450, North Dakota State University, Department of Agribusiness and Applied Economics.
    7. Bangsund, Dean A. & Leistritz, F. Larry, 1998. "Economic Contribution Of The Barley Industry In North Dakota, South Dakota, And Minnesota," Agricultural Economics Reports 23423, North Dakota State University, Department of Agribusiness and Applied Economics.
    8. Coon, Randal C. & Leistritz, F. Larry, 1998. "The State Of North Dakota: Economic, Demographic, Public Service, And Fiscal Conditions - A Presentation Of Selected Indicators," Miscellaneous Publications 23076, North Dakota State University, Department of Agribusiness and Applied Economics.
    9. Bangsund, Dean A. & Leistritz, F. Larry, 2004. "Economic Contribution Of The Sugarbeet Industry In Minnesota, North Dakota, And Eastern Minnesota," Agribusiness & Applied Economics Report 23618, North Dakota State University, Department of Agribusiness and Applied Economics.
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    Cited by:

    1. Bangsund, Dean A. & Hodur, Nancy M., 2015. "Petroleum Industry's Economic Contribution to North Dakota in 2013," Agribusiness & Applied Economics Report 199400, North Dakota State University, Department of Agribusiness and Applied Economics.
    2. Coon, Randal C. & Olson, Frayne & Bangsund, Dean A. & Hodur, Nancy M., 2015. "Contribution of the Pulse Crop Industry to the Economies of North Dakota and Eastern Montana," Agribusiness & Applied Economics Report 231252, North Dakota State University, Department of Agribusiness and Applied Economics.
    3. Hyland, Michael F. & Mahmassani, Hani S. & Bou Mjahed, Lama, 2016. "Analytical models of rail transportation service in the grain supply chain: Deconstructing the operational and economic advantages of shuttle train service," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 93(C), pages 294-315.
    4. Ripplinger, David & Saxowsky, David M. & Bangsund, Dean A., 2014. "Economic Feasibility of Irrigation Along the McClusky Canal in North Dakota: Farm-level Returns," Agribusiness & Applied Economics Report 196960, North Dakota State University, Department of Agribusiness and Applied Economics.
    5. Bangsund, Dean A. & Hodur, Nancy M., 2017. "Petroleum Industry's Economic Contribution to North Dakota in 2015," Agribusiness & Applied Economics Report 260193, North Dakota State University, Department of Agribusiness and Applied Economics.
    6. Bangsund, Dean A. & Hodur, Nancy M., 2013. "Petroleum Industry's Economic Contribution to North Dakota in 2011," Agribusiness & Applied Economics Report 146512, North Dakota State University, Department of Agribusiness and Applied Economics.
    7. Bangsund, Dean A. & Saxowsky, David M. & Ripplinger, David, 2014. "Regional Economic Effects of Irrigation Along the McClusky Canal in North Dakota," Agribusiness & Applied Economics Report 196708, North Dakota State University, Department of Agribusiness and Applied Economics.
    8. Ndembe, Elvis & Hodur, Nancy M. & Bangsund, Dean A. & Coon, Randy, 2017. "Economic Contribution of Horse Racing to North Dakota in 2016," Agribusiness & Applied Economics Report 264415, North Dakota State University, Department of Agribusiness and Applied Economics.

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    Keywords

    Crop Production/Industries; Production Economics;

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