While it comes as no surprise, USDA projects that 2009 farm incomes will drop significantly from those of 2008, according to the 2009 Farm Income Forecast report released today.
The report forecasts net 2009 farm income at $57 billion, down $30 billion or 34.5 percent from 2008. The 10-year average for net farm income is $63.6 billion, according to the report, so this-year’s projection is down $6.5 billion from that average.
However, if 2009 incomes reach the projection this would be the eighth-best year for incomes in U.S. farming. The top five earnings years were between 2003 and 2008, according to the report.
Reasons for the drop in incomes according to the report are the decline in 2009 crop and livestock prices as global economic conditions deteriorated and demand for exports has tailed off. Farmers have, as a result, had to accept lower prices than they expected earlier in the year when production plans were made.
The losses could have been worse, as the report projects input prices to be lower than in 2008, particularly for most manufactured inputs, feed, and services such as repairs or transportation.
Also, because most farm families generate much of their income from off-farm sources, their actual household income will not, on average, reflect that 34 percent reduction. The report projects average family farm household 2009 income at $76,065, down 3.5 percent from 2008 and 6.8 percent below the five-year average for 2004 through 2008.
Read the full report.
Source: Drover’s, USDA