farm income
Nearly 1 in 5 farmers expects lower taxes — a factor in ag optimism
Farmers and ranchers say they are in a better financial situation than a year ago, according to the Ag Economy Barometer's monthly survey. The Purdue economists who oversee the barometer said farmers are markedly more optimistic than last summer, with one factor being the expectation of lower taxes in coming years.
On the horizon: Huge corn and soy crops, low market prices
The U.S. corn and soybean crops will be slightly larger than expected, mammoth production that would assure lackluster commodity prices far into 2018, according to a USDA survey of growers. With normal weather and yields, the corn and soybean harvests would be the second-largest on record and would be piled on top of stockpiles that have been growing since the 2012 drought.
Perdue assures farmers, ‘You grow it and we’ll sell it’
Standing in shirtsleeves on a hay rack at an Iowa farm, Agriculture Secretary discarded his prepared speech in favor of repeated promises to be an unstinting advocate of U.S. food and ag exports, which generate 20 percent of farm income. President Trump supports biofuels, said Perdue, adding, "I think it was the boss who said we're not going to mess with the RFS (Renewable Fuels Standard)."
U.S. land retirement rises and falls with commodity prices
Congress has adjusted the enrollment cap on the Conservation Reserve, which pays landowners an annual rent to idle fragile land, in every farm bill since the program was created in 1985. With commodity prices in a trough, there are calls for a sizable increase in the reserve, a step that could affect wheat production far more than corn or soybeans according to a back-of-the-envelope estimate.
Administration is on farmers’ side on exports, says Perdue
From President Trump down, the administration recognizes the importance of farm exports, said Agriculture Secretary Sonny Perdue, adding that he expects to make frequent trips overseas to promote sales. Farmers voted by wide margins for Trump over Democrat Hillary Clinton last November, although his plans to renegotiate NAFTA and overhaul trade pacts in general has stirred concern in rural areas.
Farmers cut costs, borrow less, in response to low profit margins
Pinched by continued declines in farm income, producers are tightening their belts this year rather than borrowing money from the bank, says a quarterly report by the Federal Reserve. The volume of new non-real-estate loans issued by ag bankers from January-March was down 16 percent compared to the same period in 2016, and it followed a significant decline in the closing months of 2016.
Trump lists agriculture among U.S. trade issues in meeting with Xi
In the first face-to-face meeting between President Trump and President Xi Jinping of China, the two leaders agreed to a 100-day effort to improve trade relations between the world's two largest economies. Secretary of State Rex Tillerson said the president "raised serious concerns about the impact of China’s industrial, agricultural, technology, and cyber policies on U.S. jobs and exports."
Tax reform is great, say ag experts, if farmers can keep their breaks
President Trump won election partly on his promise of tax reform, boosting the prospects for the first comprehensive overhaul of the tax code in three decades. Witnesses at a House Agriculture Committee hearing said any reform package must retain benefits now available to farmers, such as deducting interest paid on loans and use of cash accounting to calculate income.
Senate panel ‘will move as quickly as possible’ on Perdue nomination
American agriculture is "going through a rough patch right now," so the Senate Agriculture Committee "will move as quickly as possible in a bipartisan fashion ... to get the governor down to the department," chairman Pat Roberts said, referring to the nominee for agriculture secretary, former Georgia Gov. Sonny Perdue. The committee has scheduled a confirmation hearing for Thursday at 10 a.m. ET.
FAPRI forecasts stability in farm income while land values slip
After suffering a 31-percent drop in net cash income in three years, the U.S. farm sector will see stable to modestly rising income in coming years, while farmland values will fall 11 percent before leveling off at the end of this decade, says the Food and Agricultural Policy Research Institute. The University of Missouri think tank says farm debt will rise, as will indicators of financial stress, such as the debt-to-asset ratio.
Large family farms generate 42 percent of U.S. agricultural production
By far, the family-owned-and-operated farm is the prototype of U.S. agriculture: 99 percent of U.S. farms are family farms, say USDA economists. Increasingly, large family farms are the leading source of production; only 2.9 percent of them have more than $1 million a year in gross cash farm income but they deliver 42 percent of U.S. production.
House Ag panel quietly asks for more farm bill money
The leaders of the House Agriculture Committee said aloud, albeit softly, what they have hinted for weeks — they want more money for the 2018 farm bill than is being spent under current law. Chairman Michael Conaway phrased the request to the Budget Committee as a need for "budget flexibility" for the farm bill while the committee's senior Democrat, Collin Peterson, said "we may need a little more."
Farm bankruptcy rates to continue to rise
The drop in farm income and erosion in farmland values are early signs that the farm bankruptcy rate, now at a low 2 per 10,000 farms, is on the rise, said associate professor Ani Katchova of Ohio State University. The rise will be constrained by the strong equity position of the sector and the benefit of off-farm income for many operators, she said at USDA's annual Outlook Forum.
The bigger the farm, the more volatile the farm income
The total household income of crop farmers is 9 percent more volatile than that of livestock producers, say USDA economists in a report that drills into farm household income, which often includes off-farm employment. The report says farm income is more variable than income of non-farmers and that as farms get bigger, so does the degree of volatility of their income.
Farm numbers dip slightly while income plunges
Three years after the collapse of commodity prices, there are only slightly fewer farms in the United States than when the seven-year boom peaked and farm income was record high, according to USDA data. The government estimated there were 2.06 million farms in 2016, down 2 percent from 2013, the same period in which net farm income, a gauge of solvency, plummeted 46 percent.
Trump: Tweaks for Canada, but ‘we’re going to work with Mexico’ on NAFTA
After his first meeting with Canada's prime minister, President Trump tagged Mexico as his prime target in renegotiating the two-decade-old North American Free Trade Agreement. "We'll be tweaking it," Trump responded when asked about the impact on Canada. "It's a much less severe situation than what's taking place on the southern border."
Ag bankers say slump in farmland values will continue this year
Weak farm income pulled down farmland values across the Midwest and much of the Plains as 2016 closed and ag bankers expect prices to slide again before the spring planting season, said Federal Reserve banks in Chicago, Kansas City and St. Louis. The Chicago Fed said land values have fallen for three years in a row in its five-state district in the heart of the Corn Belt.
U.S. farm income to be half of 2013 peak, farm debt to rise by 5 percent
The government forecast U.S. net farm income at $62.3 billion this year, the lowest since 2009 and only half of the record income of 2013 at the crest of the agricultural boom. In inflation-adjusted terms, 2017 net farm income would be the lowest since 2002. Farm debt was forecast to increase by $19.4 billion this year, part of a 25 percent increase since commodity prices collapsed four years ago.