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Farm income expected to decline but data shows slivers of optimism

Analysis from the University of Missouri shows that US net farm income is expected to decline but remain higher than previous long-term averages.

Ag economist Scott Brown with the Rural and Farm Finance Policy Analysis Center says a cost-price squeeze is coming with a lower commodity prices and higher input costs. “When you look at 2023 cash receipts, they’re going to be about $21 billion lower than where we were in the peak of 2022, yet production expenses about $30 billion higher.”

Farm income is projected at $145 billion in 2023, a decline of about $30 billion from the record set in 2022.

He says corn, soybean and wheat prices could decline in 2024. “There’s more worry ahead, but those prices are above longer-term averages.”

But, Brown says, cattle prices will continue to increase. “I think when we look ahead in 2024, I think we’ll find record cattle prices occurring.  They took a step back here in the last week or two, but I still think we have some very optimistic opportunities in front of us.”

Brad Lubben, an ag economist with the University of Nebraska-Lincoln’s Center for Ag Profitability says Nebraska net farm income is expected to reach $7.8 billion. “We didn’t set a record in 2022.  We struggled with drought particularly in 2022 and farm income felt to about $6.5 billion in Nebraska.  We rebounded in 2023 while nationally we fell back.”

Lubben says the factors that impact Nebraska’s net farm income are very similar to the national trends.

Brown and Lubben made their comments during a UNL CAP webinar on Thursday.