News

Farm income expected to dip again this year

Net farm income, which is a broad measurement of on-farm profitability, is forecast to decline again this year.

Rob Johansson, Chief Economist at the USDA says the decline is about 8.7 percent.  He says this is the fourth consecutive year of declines after reaching a record high in 2013.

Despite cash receipts and total production expenses projected flat– Johansson says total debt will increase.  “We see about 11 percent of crop farms and a little over 10 percent animal and animal product farms stressed financially,” he says.  “We would say they are in the highly leveraged to very highly leveraged category.”

Farm asset values are forecast to drop just over 1 percent and financial liquidity, including working capital, are also predicted to weaken this year.

The debt-to-asset ratio is projected higher than its average over the previous ten years.