WASHINGTON, DC, US — Net farm income in the United States is forecast to increase by $18.5 billion dollars in 2021 to $113 billion, its highest level since 2013, according to a report released Sept. 2 by the US Department of Agriculture’s Economic Research Service (ERS).
The 19.5% increase from 2020 is due primarily to a surge in corn and soybean prices to an eight-year high, the report said.
The ERS said corn cash receipts are forecast to increase by 43% ($20.1 billion) in 2021 because of higher prices and quantities, while soybean cash receipts are projected to rise by 44.4% (16.3 billion).
The forecast is in stark contrast to the USDA’s projection in February that foresaw an 8.1% decrease in profits due to reduced government payments and higher expenses.
Direct government farm payments are forecast at $28 billion in 2021, a $17.7 billion (38%) decrease from 2020, the report said.
Much of the decline in government payments is due to lower supplemental and ad hoc disaster assistance to farmers and ranchers for the COVID-19 pandemic compared to 2020 and closure of the Market Facilitation Program, the ERS report said.
Other highlights from the report include:
- Farm cash receipts are forecast to increase by 18% ($64.3 billion) to $421.5 billion.
- Total production expenses are forecast to increase by 7.3% ($26.1 billion) to $383.5 billion.
- Farm sector equity is expected to increase by 2.9% to $2.81 trillion.
- Farm sector assets are forecast to increase by 2.5% to $3.25 trillion following increases in the value of farm real estate assets.