Government Projects Banner Year for Net Farm Income
KANSAS CITY, MO – Last year proved to be an interesting year for many reasons, but according to the Economic Research Service (ERS), 2020 may be remembered for being the year agriculture broke out of the recession to the industry had suffered through for almost a decade.
Though the actual numbers will not be available until September, ERS projects that net farm income for last year will hit $123 billion, an increase of $31 billion over the 20-year average – equal to a 44 percent increase of farm sector profitability.
Net cash farm income is expected to be close to $139 billion, which if realized will be a 25 percent year over year increase.
ERS suggests that the significant increase is due to direct government payments to farm operations that climbed to their highest level in history.
The projections for 2021 show an expectation for lower direct payments thus pushing down both profitability indicators. In a more detailed look at the future, ERS says net farm income is projected to remain slightly higher than the recent 20-year average, but net farm cash income is projected to be lower for 2021-30.
(SOURCE: All Ag News)