farm economy

Fears of falling income drive farmer confidence to lowest level in eight years

Farmer confidence tumbled by 21 percent in the past two months to its lowest level since 2016, with three of every four farmers saying they expect bad times for the agricultural economy in the year ahead, said Purdue University on Tuesday. Producers taking part in the Ag Economy Barometer survey said they were worried about declining income because of low commodity prices and high production costs.

Farm sector is in a downturn, say economists

After seeing record profitability in 2022, the U.S. farm sector is in a downturn for an indefinite period, said a band of agricultural economists on Monday. Congress could feel pressure to provide a bailout to buffer the decline in income, at the same time that producers try to pare their costs, they said at a conference sponsored by the Agricultural Business Council of Kansas City.

Third year of farm income decline is on the horizon

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.

For rural America, election is ‘certainty vs. chaos’ or Trump as defender, say advocates

Vice President Kamala Harris bears the blame for high prices and declining farm income, said Indiana farmer Kip Tom on Monday, pushing for the reelection of Donald Trump as president. On the contrary, said Harris advocate Rod Snyder, calling the Nov. 5 election "a choice between certainty and chaos," like the Sino-U.S. trade war that cost farmers billions of dollars in lost export sales.

Farm income is down in Plains, say ag bankers

More than six of every 10 ag bankers in a Kansas City Federal Reserve Bank survey said that farm income was lower than a year ago and demand for loans was up. “Strong cattle prices have supported profit margins in the cattle sector, but prices for crops have declined faster than production expenses,” said the regional Fed on Tuesday.

Multiyear run of low corn and soybean prices looms

Corn and soybean farmers should plan for much lower market prices for their crops in the near term, given trends in the futures markets, said six analysts writing at the farmdoc daily blog. “We may be again entering a period of lower prices, like that from 2014 through 2019,” they said.

Lower commodity prices darken farm income outlook, says Federal Reserve

Farmers are on track to harvest some of their largest corn and soybean crops ever, but the ongoing decline in commodity prices is putting farm income in question, said the Beige Book issued by the Federal Reserve Board on Wednesday. Regional Fed banks in Chicago and Minneapolis said the farm income outlook had weakened in recent weeks, while the Kansas City Fed said agricultural conditions in its district “faced headwinds from weak crop prices.”

Farmers’ tax liability to rise as tax breaks expire in 2025

Farmers would face an increased federal tax liability of billions of dollars following the expiration of Trump-era tax breaks in 2025, said USDA economists. The biggest impact, estimated at a combined $4.5 billion, would come from reduced income tax rates on individuals, an increased standard deduction, a cap on the deduction for state and local taxes, and the elimination of the personal exemption.

USDA report looks at ways to grow biomass market

Expanding the market for biomass-based products, which include furniture, bioplastics, and biofuels, would create new sources of revenue for the agricultural sector, said a USDA report released on Thursday. It recommends a broad-ranging effort by the government to encourage greater production.

Vilsack and lawmakers spar over farm economy

During a sometimes prickly House hearing on Wednesday, Agriculture Secretary Tom Vilsack urged lawmakers to buckle down and write a farm bill that does not cut SNAP or climate funds. Republicans on the House Agriculture Committee said the Biden administration has overlooked the needs of the large-scale farmers who produce the bulk of U.S. crops and livestock.

While still above average, farm income is forecast to fall this year

U.S. farm income will tumble for the second year in a row from the record set in 2022, pulled down by lower commodity prices and rising production costs, forecast the Agriculture Department on Wednesday. Net farm income would fall 25 percent, to $116.1 billion, but still run 15 percent ahead of its 10-year average.

Interest rates rise faster than farmland values, says economist

For the first time since 2001, interest rates are rising faster than farmland values, creating a potential obstacle to land purchasers, said assistant economist Ty Kreitman of the Kansas City Federal Reserve Bank. “With interest costs now above average land value appreciation, farm operating profits will determine the magnitude of returns for financed land,” he said.

Rural Iowa was important but not decisive for Trump, says analysis

Former president Donald Trump won 60 percent of the rural vote in Iowa’s Republican presidential caucuses, well above his statewide total of 51 percent. But his victory Monday in the first-in-the-nation test of voter support for presidential candidates was built on the vote in towns, where most Iowans live, said a Daily Yonder analysis.

As inflation falls, ‘backwards pressure’ on food prices, analyst says

Compared to food price inflation of 11 percent in 2022, grocery price increases will be virtually nonexistent this year, said a Wells Fargo analyst Wednesday during a panel discussion on the 2024 outlook for the food and ag sector. A Rabobank analyst said that softer commodity prices would take the steam out of the hot farmland market.

Farm income this year will be second-highest ever, says USDA

U.S. net farm income will be a stronger-than-expected $151 billion this year, the second-highest total on record, estimated the Agriculture Department on Thursday. That’s roughly $10 billion higher than the August forecast and due chiefly to cost cutting by producers, aided by lower fertilizer, fuel, and feed prices.

High interest rates discouraging farmers from borrowing money

Ag bankers say farmers are tapping their savings from recent boom years instead of borrowing money at what are the highest interest rates since 2007. The average operating loan issued this past summer was nearly 20 percent smaller than the average a year ago, the lenders said in surveys by regional Federal Reserve banks.

Some signs of softening farmland values, says Fed economist

Although farmland values are strong, some ag bankers report a downturn in prices in the central Plains after a three-year run-up in values, said senior economist Cortney Cowley of the Kansas City Federal Reserve on Wednesday. The majority of bankers, however, expect farmland values to hold steady or increase moderately.

Vilsack: Farm bill ‘is not the only tool available’ to expand ag economy

The Biden administration is broadening the U.S. agricultural economy through climate-smart and bioproduct initiatives while Congress is seemingly stymied over the new farm bill, said Agriculture Secretary Tom Vilsack on Monday. He warned against raiding conservation funding to pay for higher reference prices for corn, soybeans, and other row crops, a leading goal of farm groups.

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