Thanks to livestock revenue, farm income will be stronger than expected
U.S. net farm income will be a much better than expected $140 billion this year, the fourth-highest total on record, forecast the Agriculture Department on Thursday. Production expenses are down for the first time since 2018, while farmers are pocketing increased revenue from eggs, cattle, milk, and broiler chickens.
Farmer confidence falls along with commodity prices
More than half of American farmers say their farming operations are worse off financially now than a year ago, according to a Purdue University poll released on Tuesday, which also found increasing concern about low market prices for crops and livestock. "The weakness in farmer sentiment could indicate that farmers expect this year's farm income downturn to last for an extended period," said the Ag Economy Barometer.
Corn, soy, wheat prices to run at pre-pandemic levels in years ahead
After soaring at the start of this decade, season-average prices for the three major U.S. crops will drop to pre-pandemic levels and stay there for the near term, said a University of Missouri think tank on Thursday. Cattle would be the most notable exception to an overall decline in crop and livestock values.
A long wait for farm subsidies to arrive
The ongoing decline in commodity prices is expected to pinch farmer revenue, but a commonly proposed solution — higher crop support rates — would provide little immediate relief, said farm policy expert Jonathan Coppess on Thursday.
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.
Cropland values soar 37 percent in four years
U.S. cropland is worth an average of $5,570 an acre, an increase of $1,510, or 37 percent, since 2020, said the USDA's annual Land Values report. The surge in land values accompanied the four highest years of net farm income, a gauge of profitability, for American farmers.
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.”
Value of U.S. corn, soy, and wheat crops slips
The farm-gate value of this year's U.S. corn, soybean, and wheat crops would be nearly 8 percent lower than the 2023 crops due to the continuing decline in commodity prices, according to USDA estimates of season-average prices.
Lower crop returns will pressure farmland market, say analysts
The boom in corn and soybean prices since 2020 is fading away, with lower farm income likely in the near term, wrote three agricultural economists in the farmdoc daily blog. “Returns to farming have declined, suggesting that cash rents should decline as well. How quickly or how much cash rents decline will depend on how far commodity prices fall as well as potential policy responses to those declines,” they said.
Higher commodity prices soften farm income decline, say banks
Springtime increases in corn, soybean, and wheat prices brightened the outlook for the agricultural sector amid expectations of lower farm income this year than in 2023, said Federal Reserve regional banks in the Beige Book report on Wednesday. The Chicago and Dallas banks said the discovery of bird flu in dairy cattle was a cause for concern.
Ag bankers say farm income is down from 2023 in Central Plains
Farm income "retracted at a sharp pace" in the Central Plains ahead of the spring planting season, said the Kansas City Federal Reserve Bank, based on a quarterly survey of ag bankers. Sixty percent of the lenders — the highest percentage since early 2020 — said income was lower than a year earlier.
Substantial oil, gas, and wind payments go to a sliver of farmers
A fraction of U.S. farmers, about 3.5 percent, receive payments for oil, gas, and wind energy production on their land, and those payments provide “substantial income,” said a USDA report. With the growth of wind and solar energy, a wider array of farmers could benefit from the payments, now centered in the Great Plains, said the Economic Research Service.
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.
‘We need a safety net that works,’ say farm-state senators
Pointing to forecasts of a second year in a row of falling farm income, Republican senators called for more money for farm subsidies on Wednesday. “We’ve got to get it right for production agriculture” in the new farm bill, said North Dakota’s John Hoeven at a Senate Agriculture Committee hearing.
USDA announces grants for underutilized renewable technology
The USDA will offer $144 million in grants to help farmers install under-utilized renewable energy technology, such as small-scale windmills, announced Agriculture Secretary Tom Vilsack on Monday. The clean energy equipment could reduce costs and increase income, said the USDA.
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.
GAO: Many barriers to precision agriculture beyond cost
Precision agriculture equipment, such as yield monitors, have been available since the 1990s, yet farmer adoption of the technology has been slow, said a congressional report on Thursday that listed a half-dozen barriers beyond high acquisition costs.
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.
Farm income cools, land prices climb in northern Plains
Cropland values rose by 7.2 percent in the northern Plains this summer, said agricultural bankers in a quarterly survey by the Minneapolis Federal Reserve Bank. Land values rose even as farm income declined from last summer, lenders said, due to high production costs and lower commodity prices, with a decline expected for this fall, too.