Daniel Munch, economist with the American Farm Bureau Federation, reported recently that the latest estimate from the USDA on 2023 farm income is expected to be down 23 percent.
The full article by Munch, with graphs and stats, can be accessed at https://www.fb.org/market-intel/usda-forecasts-23-drop-from-2022-farm-income-levels .
In his summary, the AFBF contributor said, “USDA’s most recent estimates for 2023 net farm income provide an updated estimate of the farm financial picture. For 2023, USDA anticipates a 23 percent decrease in net farm income, moving from $183 billion in 2022 to $141 billion in 2023.”
He said that much of the forecasted decline in 2023 net farm income “is tied to lower crop and livestock cash receipts, continued increases in production costs and a decrease in ad hoc government support.”
Munch said, “It is important to highlight the projected nature of this forecast. 2022 net farm income numbers were not finalized until August 2023 and were adjusted upward over $20 billion in the eight months since the year ended. During this time USDA is digesting new information and data as it becomes available, shifting calculations from estimates to actual values.
“This means there is still much variability in 2023 net farm income. At the very least, these estimates show the relationship between, on average, falling commodity prices and rising production costs and the ultimate impact on farmers’ bottom lines.”
Munch continued, “Combined with weather uncertainty and a high cost of capital to operate their businesses, farmers and ranchers will be forced to adapt as they always have.”
And, he said, “Part of being able to adapt means having clarity on rules that impact their businesses’ ability to operate, having access to comprehensive risk management options and being given a resounding voice during formulation of vital legislation such as the farm bill, which can either complicate or streamline farmers’ and ranchers’ ability to sustainably contribute to a reliable and resilient U.S. food supply.”
