Farm production expenses are up again, and net cash farm income is down, though there is some good news as 2023 comes to a close. Farm production costs are forecast to jump another three-and-a-half percent this year, with interest and livestock costs making up most of that.
USDA Chief Economist Seth Meyer tells USDA Radio that farmers will have spent 14 percent less for fertilizer this year, and less for pesticides, fuel, and livestock feed. Net cash farm income, though, is expected to fall.
Spiro Stefano heads USDA’s Economic Research Service and says “The net cash farm income for the calendar year 2023 is forecast at nearly $158 billion, which is down about 21 percent, relative to 2022.”
Though 2022 was a record year for net cash farm income, Stefano says farm solvency remains strong this year with asset values growing faster than debt. “The farm sector remains fairly healthy in terms of its solvency. Bankruptcy rates have continued to fall, a fairly healthy financial situation for the farm sector,” according to Stefano.
Compared with the last 20 years, farm income is still forecast above average despite the drop from 2022.
