USDA predicts 2022 median farm household income to fall slightly from 2021 because of inflation, less government aid - Entrepreneur Generations

U.S. net farm income and net cash farm income, inflation adjusted, from 2002 to the 2022 forecast. (Agriculture Department chart; click the image to enlarge it.)

In its latest Farm Income Forecast, the Agriculture Department said "it expects farm income for 2022 to rise 5.2%, to $147.7 billion, from a year earlier, with cash receipts for agricultural commodities at a record level. But higher production expenses and lower government Covid-19 payments are presenting some headwinds," Samuel Fromartz reports for Successful Farming. "The slight bounce in income comes after 2021, when farm income shot up $45.9 billion, or more than 48%, to the highest inflation-adjusted level since 2013. If 2022 income were adjusted for inflation — now at the highest level in decades — it would have declined 0.9 % from 2021 levels." Click here to read the report.

Other highlights from the report, which is released three times a year:

• Net cash farm income, a more precise measure of profits, is forecast at $168.5 billion in 2022, an increase of $22.1 billion (15.1 percent) relative to 2021. The 2021 value was $29.6 billion (25.4 percent) above 2020.
• When adjusted for inflation, 2022 net cash farm income is forecast to increase by $13.5 billion (8.7 percent) from 2021 and be at its highest level since 2012. Net cash farm income in 2022 would be 34.5 percent above its 2002–21 average of $125.3 billion.
• Cash receipts from the sale of agricultural commodities are forecast to increase by $91.7 billion (21.2 percent, in nominal terms) from 2021 levels to $525.3 billion in 2022. Total crop receipts are expected to increase by $36.4 billion (15.3 percent) from their 2021 level following higher receipts for soybeans, corn, and wheat.
• Total animal/animal product receipts are expected to increase even more from the previous year, by $55.3 billion (28.3 percent), following increases in receipts for all categories of animal/animal products. These increases would put total cash receipts in 2022 at their highest level on record, even after adjusting prior years for inflation.
• While cash receipts overall are expected to increase in 2022, lower direct Government payments and higher production expenses are expected to moderate income growth.
• Direct Government payments are forecast to fall by $12.8 billion (49.7 percent) from 2021 to $13.0 billion in 2022. The decrease is expected largely because of lower supplemental and ad hoc disaster assistance for Covid-19 relief in 2022 compared with 2021.
• Total production expenses, including operator dwelling expenses, are forecast to increase by $66.2 billion (17.8 percent) to $437.3 billion (in nominal terms) in 2022.
• Spending on all categories of expenses is expected to rise with the largest increase in fertilizer-lime-soil conditioner expenditures, up 44 percent.

from The Rural Blog https://ift.tt/al9Shvi USDA predicts 2022 median farm household income to fall slightly from 2021 because of inflation, less government aid - Entrepreneur Generations

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