US farm income in 2024 will not fall as sharply as initially feared, according to an updated government forecast released Thursday.
Despite plummeting crop prices, American net farm income is now only projected to decline to $140 billion, down $6.5 billion or 4.4% from a year earlier. Back in February, the USDA was forecasting a far heftier 26% fall in farm income to $116.1 billion.
US net farm income reached a record high in 2022 at $182 billion, before tumbling 19.5% in 2023 to $146.5 billion. If accurate, this year’s farm income would still be 15% above the 20-year average of $121.5 billion.
“Today’s farm sector income forecast shows that, while the projection shows a decline from the 2022 record high, 2024 is expected to close out a four-year streak of net farm income that’s above the 20-year average,” US Agriculture Secretary Tom Vilsack said in a statement. “For the prior four years, net farm income was consistently at or below that historic average, even before the COVID-19 pandemic.”
Overall, US farm cash receipts are forecast to decrease by $9.8 billion or 1.9% from 2023 to $516.5 billion in 2024 in nominal dollars. Total crop receipts are expected 10% or $27.7 billion lower to $249 billion, given lower receipts for corn and soybeans. Net corn receipts are expected to decline by $16 billion, or 20%, to $64.1 billion, while soybean receipts are forecast to fall $8.6 billion, or nearly 15%, to $50.4 billion.
On the other hand, total animal/animal product receipts are projected to increase by $17.8 billion or 7.1% to $267.4 billion in 2024. Receipts for eggs, cattle/calves, milk, and broilers are also forecast to rise relative to 2023.
Direct government farm payments are forecast at $10.4 billion in 2024, a $1.8 billion or 15.1% decrease from 2023.
Total production expenses, including those associated with operator dwellings, are forecast to decrease by $4.4 billion or 1% from 2023 to $457.5 billion in 2024. Feed, fertilizer (including lime and soil conditioners), and pesticide expenses are expected to see the largest declines in 2024 while livestock/poultry purchases are expected to see the largest dollar increase relative to 2023.
Vilsack admitted that returns to crop producers “remain a challenge,” but added today’s farm income forecast – versus the one in February – indicates that income for livestock producers will rise, and farmers will continue to see declining production expenses led by feed, fuel and fertilizer.
