USDA Predicts 23% Drop in 2023 Net Farm Income from 2022 Levels

The USDA has revised its net farm income forecast for 2023, predicting a sharp decrease of 23% from the 2022 figure, resulting in a drop from $183 billion in 2022 to an expected $141.3 billion in 2023. This decline is significant, effectively wiping out the previous year’s gains. The report shows an ongoing rise in farm and ranch production expenses, a continuous decrease in government payments for producers, and fluctuating cash receipts across various commodities. Notably, livestock receipts are anticipated to fall, particularly in poultry, due to factors such as the impact of avian influenza. In contrast, cattle and calf receipts might see an increase because of drought conditions leading to supply challenges. Cash receipts for crops are expected to vary, with key crops like corn and soybeans facing declines. Production costs are projected to escalate for the sixth consecutive year, reaching a record of $458 billion in 2023. With these conditions, combined with weather unpredictability and the rising cost of capital, farmers and ranchers are poised for challenging times ahead. The USDA emphasizes the projected nature of this forecast, implying potential variability in the final numbers for 2023. Farmers and ranchers are encouraged to remain adaptable, emphasizing the need for clear regulations, comprehensive risk management options, and a significant voice in shaping crucial legislative measures.