Farm Incomes Flatten

This is Tim Hammerich of the Ag Information Network with your Farm of the Future Report.

Farm incomes in the Minneapolis Federal Reserve Bank’s district flattened out in the second quarter of 2023. Joe Mahon, director of regional outreach with the Minneapolis Fed, says the incomes didn’t drop sharply.

Mahon… “I wouldn't cast too much negativity on it. I wouldn't call it a real big decline in farm incomes or anything of that sort, but definitely a stabilization from the trend that we've seen over the last few years, which has been growing farm income. We've seen increasing farm incomes since sort of late 2020 recovery from the pandemic started to take place and the effects that that was having on the food supply chain. That was generally to the benefit of farmers. And what we found in our most recent survey, which covered the second quarter, was on average, a slight decline or leveling off of farm incomes relative to the same period a year earlier.”

Mahon says a couple of factors might be behind the flatter incomes.

Mahon… “Commodity prices have dropped a little bit from their recent highs, and although, historically speaking, they're still at relatively good levels, we know that the input costs have been pretty high as well. And so, we're starting to see something happen in some areas where certain producers are going to be at or falling below their breakeven levels. The other thing that I should mention is that we've seen some drought over the summer in some of the key parts of our region. They've gotten some rainfall recently, which is a good thing.”

Mahon said many of the other key financial indicators still look solid.