Minnesota farmers overcame erratic weather and volatile markets to post record profits last year, according to the University of Minnesota and Minnesota State Colleges and Universities system.

The survey of nearly 2,400 Minnesota farms found median net farm income reached a record $123,000 last year, up 1 percent, the St. Paul Pioneer Press reported Wednesday.

While many crops didn’t yield as well as the previous year because of erratic weather, Don Larson of Sargeant Grain Elevator attributes the profits to high grain prices.

“Raising the corn is what was the driver for them,” he said.

While beef prices have been high, as well, Larson said corn has been the main reason for the spark in the economy.

However, he added the corn price has fallen in recent weeks from $6.50 a bushel to about $6 per bushel, which may be in anticipation for a record high supply of corn this fall. Area farmers just started applying anhydrous fertilizer days ago, and some have already planted oats and alfalfa. But despite last year’s record prices, Larson said farmers always need to be prepared for two to three years of losses afterward.

According to the report, higher grain prices and more profitable livestock operations helped improve the 2011 numbers. But stressful weather and lower crop yields limited the gains.

Minnesota’s 2011 growing season had a late and soggy start, an early frost and a drought that lasted all autumn. While those factors helped push grain prices to record highs, they also cut into yields.

“Even with record-high crop prices, crop farms saw a slight decrease in profitability,” said Dale Nordquist, an extension economist with the University of Minnesota’s Center for Farm Financial Management. “Crop farms were still very profitable, but the lack of rain at the end of the growing season along with increasing production costs kept them from attaining higher profits.”

The report found most Minnesota livestock farms showed improvement in 2011.

Dairy farmers reported median net farm income of $91,000, up from $68,000 the year before. The median is the midpoint, where half the farm incomes in the survey were higher and half were lower.

Hog and beef producers also reported gains, although higher feed costs had an effect. Many Minnesota producers grow their own feed, which helped offset the price jump.

—The Daily Herald contributed to this report.