The latest forecast for farm income shows a slight bump, following years of decline. Projections of farm income are part of USDA’s Economic Research Service 2017 Farm Sector Income Forecast which suggests that while farm income may have hit rock bottom in 2016, there will be an uptick in both net farm and net cash income in 2017. American Farm Bureau Federation Chief Economist Dr. Bob Young says livestock sales are driving the slight increase.
“It is just kind of a minor bump, but is a bump as opposed to continuing to fall. The livestock side really drove most of that increase. The crop revenue side, crop receipts, are effectively flat, 2017 relative to 2016.
Forecasts for both livestock and crop cash receipts are promising. Livestock cash receipts will increase by 4.8 percent and crop cash receipts will increase by 1.6 percent in 2017. Dr. Young cautions though that the year’s overall farm income is hard to predict.
“Give me a weather forecast and I’ll give you a farm income forecast at this stage in the game. We’ve got some of the strongest demand we’ve ever had, but we also have some of the strongest production that we’ve ever had. So, probably would take a little bit of a production pullback for prices to really pop, but wouldn’t take much of a production pullback for that to happen.”
Given recent projections, Young says for planning purposes, at the very least where we’re at is probably where we’re going to be for a while, so put business plans together accordingly.