Farm sector income is expected to drop in 2023. Net farm income is forecast to decrease by $25.9 billion or 15.9% from 2022 to $136.9 billion in 2023. Net cash farm income is forecast to decrease to $150.6 billion in 2023, a decrease of $39.4 billion or 20.7% from 2022, according to the U.S. Department of Agriculture (USDA) Economic Research Service (ERS).
That is not good news for farmers who are still trying to navigate high input expenses and lower commodity prices. Total production costs are expected to increase by $18.2 billion or 4.1% to $459.5 billion this year.
Vegetable and melon cash receipts are expected to decline by $1.9 billion or 8.7% in 2023, despite an increase of $0.3 billion or 7.5% in potato receipts. Cash receipts for fruits and nuts are expected to fall by $0.1 billion or 0.4% in 2023.
American Farm Bureau Federation President Zippy Duvall discussed the depressing news for producers and the importance of a farm bill being finalized this year.
“The farm income forecast is a stark reminder that America’s farmers and ranchers are not reaping big benefits from higher prices at the grocery store,” Duvall said. “Although some commodity prices are rising, farmers are being hit by circumstances beyond their control, from the cost of supplies and labor to drought and avian influenza. That’s why the farm bill is so important and must be passed this year. Farm bill programs enable farmers to manage the risk and weather the storm of challenges to continue stocking the pantries of America’s families.”
Multiple expense categories are expected to increase in 2023. Interest expenses will rise by $6.2 billion or 22.4% to $33.8 billion in 2023. Labor costs will also increase by $2.9 billion or 7.3%, reaching $42.5 billion.