Farm Income Forecast to Rise in 2020 Despite Challenges

USDA’s Economic Research Service recently released its latest forecast of farm sector income and wealth in 2020. Carrie Litkowski is the Senior Economist and Farm Income Team Leader with the ERS. She says despite the many challenges facing agriculture this year, net farm income is still expected to increase.

“Net farm income is forecast to increase by almost 23 percent in 2020" said Litkowski. "This increase comes despite lower cash receipts from commodity sales in 2020. We’re forecasting cash receipts to fall 3.3. percent, or 12 billion dollars.”

Net cash farm income is forecast at $115.2 billion, up 4.5 percent over last year in nominal dollars. Despite lower commodity prices, she says lower production expenses and government payments will help boost farm income this year

“Much of the increase in net income is coming from direct government payments to farmers from farm programs, which are forecast to increase by 14.7 billion dollars or nearly 66 percent in 2020" said Litkowski. "Also contributing to income are total production expenses, forecast to decline 4.6 billion dollars, thereby boosting income.”

Farm household median income is another way the ERS measures the health of the farm sector.