Already-bulging U.S. corn and soybean stockpiles are much larger than expected, said a USDA report, compounding the effects of a trade war and bumper crops on the farm economy. Farm income this year is forecast to be the lowest since 2006.
When the commodity boom collapsed in 2014, U.S. farm income plunged along with it. While there are signs that income is stabilizing, economists Brent Gloy and Dave Widmar say their foremost concern "is more about the duration than the magnitude" with the fourth year of persistently low income going into the books.
U.S. farm income is higher than expected this year and is regaining its footing after taking a tumble early this decade, said the Agriculture Department on Thursday. Nonetheless, net farm income will be the lowest since 2006, and the debt-to-asset ratio is rising for the sixth year in a row.
With commodity prices dropping and farm income projected to plummet, America’s farmers are growing increasingly anxious over the lack of specifics about how much money they’re going to get, and when they’re going to get it, from President Trump’s $12-billion bailout, reports The Wall Street Journal.
Seven of 10 farmers participating in a Purdue poll said they expect lower net income this year due to the tit-for-tat tariff war - a dour outlook that pulled down the monthly Ag Economy Barometer to its lowest reading since President Trump was elected in November 2016. The 26-point drop wiped out the remnants of "Trump bump" agricultural euphoria that propelled the barometer to a record high as Trump took office.
The financial health of farms is commonly demonstrated through its net income, or a farm household's financial losses or gains over the course of a year. According to those metrics, each year just over half of the U.S.'s 2 million farms report negative income. But a new report from the USDA's Economic Research Service uses a wider scope—including asset appreciation, unpaid labor, and tax benefits from farming—to assess the economic state of the country's farms in 2015.
Four days after defeating the farm bill, the House quietly delayed Speaker Paul Ryan's attempt to revive the bill until June 22, with GOP leaders hoping that hardline Republicans will vote for it the second time. Members of the House Freedom Caucus provided the decisive votes against the farm bill to underline their demand for a roll call on immigration controls. (No paywall)
With a trade war looming, commodity prices swooning, and the dairy industry in full-blown crisis, a growing number of American farmers are embracing a controversial set of farm policies that would manage the country’s commodity production and stabilize crop prices. No paywall
The farm bill was the missing topic during a 45-minute session recently with farmers in southwestern Missouri, recalls Sen. Roy Blunt. "The farm bill never came up." Instead, growers talked about threats to farm exports, over-regulation and the need for rural broadband. Agriculture Secretary Sonny Perdue says low commodity prices, the slump in farm income, attacks on corn ethanol and, most of all, anxiety about a possible trade war are the top concerns in farm country. No paywall
The first major agricultural flaw found in the new tax law has “got to be changed,” said Iowa Sen. Chuck Grassley. Grain companies are very concerned that Section 199A of the new law “would put them out of business if we don’t do something,” he said.