Evaluating the Financial Performance of Texas Farm Businesses in the 1980s

Abstract

The DuPont system of financial analysis is used to analyze the financial performance of the Texas farm sector during the recovery period of the 1980s. The results are compared with the performance of the U.S. farm sector during the same period. Although Texas farms showed a considerable improvement, their level of performance was consistently lower tban for U.S. farms. Most gains appear to be concentrated in the areas of livestock, livestock-related products, and cotton. Cash crop farms have yet to realize full benefits of the farm recovery. These are the farms expected to be hit barder by the proposed cuts in farm subsidies under the 1990 Farm Bill. That may further slowdown the already slow farm recovery process in Texas.