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As net income for U.S farmers soared to $82.5 billion in 2004, prices for Ohio commodities reached a record $5.46 billion, according to a report released by the National Agricultural Statistics Service and Ohio State University.

National net farm income in 2005 isn't expected to top the previous year's record, but at $71.5 billion, it would be the second highest in history.

However, several elements, including rising input costs and a new farm bill, will determine how much farmers will take in even if high prices continue.

Carl Zulauf, an Ohio State University agricultural economist, said farmers are being hit by high energy prices because of excess demand. He attributed the shortage in natural resource products, in part, to rapid growth in Southeast Asia. Compounding the problem is that for many years an extended supply of these products meant that little expansion in infrastructure and production was taking place, he said.

Zulauf said prices have been high enough long enough where expansion in the energy sector is likely to occur, but he anticipates that the United States will be importing more of its energy inputs in the future.

"We're not finding oil and gas as fast as we're using it," he said

That means that while energy prices may decline over the next five years, the logistical cost of importing products will prevent prices from returning to previous lows.

As far as the new farm bill and the Doha Round of World Trade Organization Talks, Zulauf said there are still major unknowns.

"We don't know what Doha is going to end up agreeing to if anything," he said.

But he added that the next farm bill could be one of major change, and he encouraged farmers to think about what changes they can live with or what changes would make things better.

"It's very speculative to talk about the next farm bill, but there are lots of reasons for believing substantive cuts will occur," he said.

Off-farm income may also be affected if general economic growth is impacted by Allen Greenspan's departure from his position as chairman of the Federal Reserve, Zulauf said.

"I think there is a lot of uncertainty on what interest rates will do moving forward," he said.

He added that in light of the recent wave of hurricanes and floods, farmers should plan how they would manage for future disasters. He said that with so many uncertainties in all of these areas, farmers should think strategically about the what ifs.

"Its not a call to action, its a call to thinking about action," he said.