Farm Income to Drop in 2023
“Specifically, net cash farm income is forecast to fall to about 149 billion. That's about a 27% drop from 2022”
Net farm income defined by USDA is a broad measure of profits. Letovsky cites three main reasons for the reduction.
“We expect cash receipts, those are the sales of farm commodities to fall in 2023 after being a record high and 2022. We're also expecting that production expenses are the costs that farmers have to pay for their production inputs, is expected to continue to increase into 2023 which would put with with lower net income and 2023. And government payments, which are direct payments to farmers from farm programs are expected to fall in 2023 as well so all three factors are pushing income down.”
USDA is predicting all farm production expenses will increase this year. Of particular note is interest expenses that are projected to increase 38.1% for producers.