USDA Forecasts 25% Drop in Farm Income for 2024
USAgNet - 02/12/2024
The latest USDA Farm Income Forecast reveals a challenging outlook for the agricultural community, projecting a notable 25% drop in farm income for the upcoming year. Economist Danny Munch from the American Farm Bureau Federation delves into the report's findings, emphasizing the implications for the farm economy.
Net farm income, serving as a comprehensive measure of farm profitability, is expected to decrease from $155 billion in 2023 to $116 billion in 2024. This represents a significant $40 billion or 25% year-over-year decline, marking the most substantial recorded dollar decrease in net farm income to date.
Two primary factors contribute to this substantial income downturn. Firstly, an anticipated $21 billion decline in cash receipts, reflecting lower prices received by farmers for their crops and livestock. Secondly, there's a projected $17 billion increase in production expenses, reaching a record-high expenditure of $455 billion for 2024.
The report underscores the urgency of finalizing the new farm bill within the current year. Farmers heavily rely on various programs within the farm bill, including ARC, PLC, and Dairy Margin Coverage, to mitigate the impact of cost increases, market volatility, and rising production expenses. Ensuring the availability of these safety nets becomes crucial in sustaining a secure domestic food supply amid a significant decline in farm income.
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