|Agriculture Department charts adapted by The Rural Blog. F=forecast. Click the image to enlarge it.|
Farmers' net income is predicted to hit $113 billion in 2021, the highest figure since 2013, says the Agriculture Department's Economic Research Service's newly updated Farm Income Forecast.
You can read the full report here, but below are some of the highlights:
- Net farm income, a broad measure of profits, is estimated to increase by $15.5 billion (19.6%) from 2019 to 2020, and is forecast to increase by another $18.5 billion (19.5%) from 2020 to 2021.
- Net farm income is forecast to be at $113.0 billion in 2021, its highest level since 2013 and 20% above its 2000-2020 average of $93.9 billion in inflation-adjusted dollars.
- Net cash farm income, a more precise measure of farm profits that includes government payments, is expected to hit $134.7 billion in 2021, an increase of $19.8 billion (17.2%) over 2020 in inflation-adjusted dollars.
- At $134.7 billion, net cash farm income would reach its highest level since 2014, and would be 19% above its 2000-2020 inflation-adjusted average of $111.4 billion.
- Average net cash farm income per farm business is predicted to increase by $10,000 (11.9%) to $93,700.
- Average net cash farm income is expected to increase in 2021 for farm businesses in the Heartland, Northern Great Plains, Prairie Gateway, Eastern Uplands, and Mississippi Portal, but expected to decline in the Northern Crescent, Southern Seaboard, Basin and Range, and Fruitful Rim.
- Farms specializing in hogs and corn are predicted to see the largest average net farm income growth in 2021, while farms specializing in dairy, cotton, and specialty crops are expected to see a decline.
- Crop and livestock receipts are expected to hit $421.5 billion, a $64.3 billion (18%) increase over 2020.
- Total crop receipts are forecast to increase by $37.9 billion, or 19.7%, from 2020.
- Total animal and animal product receipts are forecast to increase by $26.5 billion, or 16.0%, from 2020.
- Higher commodity prices are driving mosts of that trend. Of that increase, $36 billion would come from corn and soybeans, $9.4 billion from hogs, $8.3 billion from cattle, and $7.3 billion from broilers. Corn, soybeans, hogs, cattle, and broilers are all predicted to see double-digit increases in receipts.
- Lower direct government payments and higher production expenses are predicted to partially offset higher cash receipts.
- Direct government farm payments are expected to fall by $17.7 billion (38.6%) from $45.7 billion in 2020 to $28.0 billion in 2021. Such direct payments increased by $23.2 billion, or 103.5%, from 2019 to 2020.
- Spending in nearly all categories of expense is predicted to rise. Total production expenses, including operator dwelling expenses, are predicted to increase by 26.1 billion (7.3%) to $383.5 billion.
- Farm assets are predicted to increase by $79.0 billion (2.5%) to $3.35 trillion, mostly because of an anticipated rise in real-estate value.
- Overall farm debt is forecast to stay mostly the same from 2020, decreasing $1.0 billion (0.2%) to $443.9 billion.
- Farm sector equity and assets are predicted to decline by about 1.0% from 2020.