Lower market prices for many crops and for poultry will pull down farmer income in 2025, bringing the third year in a row of declining net farm income, said the Food and Agricultural Policy Research Institute (FAPRI) on Monday. Net farm income, a gauge of profitability, would fall by 6 percent in 2025 and rebound modestly in 2026, said the University of Missouri think tank.
Food inflation was forecast at a low 1.6 percent in 2025, rising slowly to 2.1 percent annually in 2028 and 2029. “Nevertheless, the prices of major food categories will remain well above their pre-pandemic levels,” said the think tank.
FAPRI projected net farm income would average $139.6 billion a year from 2026-29, similar to the USDA forecast of $140 billion in income this year. FAPRI says this year’s income will be $137.4 billion.
“A further reduction in cash receipts is projected for 2025, primarily because of lower prices for many crops and for poultry,” said FAPRI in an update to its farm income baseline. It pegged net farm income at $129 billion in 2025. “This results in a third straight year of declining net farm income before a modest recovery in 2026.”
For 2025, “the impact of lower crop receipts outweighs the effects of high cattle prices and moderation of some production expenses,” said FAPRI.