U.S. net farm income is projected to edge lower in 2026, with the USDA estimating inflation-adjusted net farm income will fall by $4.1 billion to $153.6 billion – setting up another challenging year for American producers.
In nominal terms, American net farm income is estimated at $153.4 billion, down about $1.2 billion, or 0.7%, from 2025, said the USDA’s first farm income forecast for 2026 on Thursday. Net cash farm income, which measures cash flow, is expected to rise 3% to $158.5 billion, though inflation erodes much of that gain.
Although still well down from 2022 when farm income peaked at $210 billion, both net farm income and net cash farm income for 2026 would remain above their long-term averages when adjusted for inflation.
Total farm cash receipts are forecast to drop $14.2 billion, or 2.7%, to $514.7 billion in 2026. Crop receipts are projected to increase modestly in nominal terms, rising $2.8 billion to $240.8 billion, though they are expected to decline slightly once inflation is taken into account. In contrast, receipts from livestock and animal products are projected to fall sharply, down $17.0 billion, or 5.8%, to $273.9 billion.
Government support is expected to play a larger role in farm income next year. Direct government farm payments are forecast at $44.3 billion in 2026, up $13.8 billion from 2025. The increase is largely driven by higher commodity program payments tied to market prices, while supplemental and ad hoc disaster assistance is also expected to remain elevated.
Within crops, higher corn and hay receipts are expected to offset declines elsewhere. Corn receipts are projected to rise $2 billion, or 3.3%, largely due to higher volumes sold. Soybean receipts are forecast to hold steady, while wheat receipts are expected to decline slightly because of lower sales volumes.
Livestock income presents a more mixed picture. Total animal and animal product receipts are forecast to decline, driven by steep drops in milk and egg revenues. Milk receipts are expected to fall $6.2 billion, or nearly 13%, due to lower prices, while egg receipts are forecast to plunge as prices retreat sharply from recent highs. Offsetting some of those losses, cattle and calf receipts are projected to rise $5.2 billion as cattle prices continue to strengthen, and broiler receipts are expected to post modest gains.
On the cost side, total farm production expenses are forecast at $477.7 billion in 2026, up 1% in nominal terms but down slightly after adjusting for inflation. Higher spending on livestock and poultry purchases and labour is expected to be partially offset by lower feed, fuel and pesticide costs, leaving overall margins tight for many producers heading into the new year.
