Agriculture contributes much to Arkansas

Agriculture accounts for 20 cents of every dollar generated in the Arkansas economy, according to a research report from the University of Arkansas Division of Agriculture.

Impact of the Agricultural Sector on the Arkansas Economy, the third in a biennial series, reports that agriculture adds $15.28 billion in total value to the state’s $74.54 billion gross state product. The information is based on economic data from 2003, the most recent available, said Jennie Popp, UA agricultural economist and one of the authors of the report.

The total value of $15.28 billion reported in the publications includes the direct, indirect and induced impacts of agriculture, Popp said.

Direct impacts include the value of agricultural production and processing for crops, agricultural animals and forestry. Indirect impacts result when agricultural firms purchase raw materials and services from other businesses. Induced impacts result when employees of agricultural and other businesses that support agriculture spend part of their income on local purchases.

A pocket-sized companion publication, Economic Impact of Arkansas Agriculture, points out that Arkansas, based on 2005 data, is in the top 20 states in the production of 17 agricultural commodities. Among them, Arkansas is No. 1 in rice; No. 2 in cotton, cottonseed and poultry broilers; and No. 3 in catfish and turkeys.

“Agriculture is critical to the Arkansas economy and is a larger component of the state’s economy than it is in the contiguous states, the southeast region and as a share of the nation’s economy,” says Wayne Miller, UA Cooperative Extension Service professor/economist.

About the year 2000, declining prices for agricultural commodities began to reduce the sector’s share of the state’s economy, Popp said. But by 2003 prices had improved and some exports have been expanding.

“If the trend continues, the impact of agriculture on the Arkansas economy should remain strong,” Popp said.

Impact of the Agricultural Sector on the Arkansas Economy is available in pdf format on the Web:

The companion piece, Economic Impact of Arkansas Agriculture, also is available as a pdf download:

Printed copies of the publications are also available, as long as supplies last, from the Arkansas Agricultural Experiment Station; call (479) 575-5670.

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