Farm income projected highest in three decades, reports USDA
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WASHINGTON, Feb. 11, 2013 - After adjusting for inflation, 2013’s net farm income, forecast at $128.2 billion, is expected to be the highest since 1973, according to USDA’s 2013 Farm Income Forecast released Monday.
Net cash income, which measures the difference between cash expenses and the combination of commodities sold during the calendar year plus other sources of farm income, is forecast at $123.5 billion, down almost 9 percent from 2012. However, 2013’s forecast would only be the fourth time net cash income, after adjusting for inflation, has exceeded $100 billion since 1973.
Agriculture Secretary Tom Vilsack said the forecast, issued by USDA’s Economic Research Service, “is another positive testament to the resilience and productivity of U.S. farmers and ranchers.”
“American agriculture continues to endure an historic drought with tremendous resolve, and last year was an important reminder of the need for a strong safety net,” he said. “To help all farmers and ranchers continue their efforts in the years ahead, and to ensure the certainty of a strong safety net, it is critical that Congress act on a multiyear, comprehensive Food, Farm and Jobs Bill as soon as possible."
Vilsack also noted he is “heartened that our farmers’ keen business sense” is continuing the trend of strong farm finances, with farm equity expected to reach a record high in 2013.
The forecast predicted farm expenses to reach a record high as well, with a projected $19.2-billion increase in total expenses in 2013. Rent, labor, and feed are the expense items expected to increase the most.
Projected median total farm household income is expected to increase by 1.2 percent in 2012, to $57,723, and by an additional 1.9 percent in 2013, to $58,845.
“Given the broad USDA definition of a farm, many farms are not profitable even in the best farm income years,” noted the report.
ERS also noted that most farm households earn all of their income from off-farm sources. Median off-farm income is projected to increase by 3.4 percent in 2012, to $55,229 and by 3.9 percent in 2013, to $57,378.
The 2013 Farm Income Forecast is available here.
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