USDA’s Economic Research Service (ERS) forecasts that U.S. net cash farm income (NCFI), defined as gross cash income minus cash expenses, will decrease by $42.2 billion (25.8%) to $121.7 billion in 2024 in inflation-adjusted dollars.
This is after NCFI decreased in 2023 by a forecast $50.2 billion to $163.9 billion. Net farm income (NFI) is forecast to decrease by $43.1 billion (27.1%) to $116.1 billion from 2023 to 2024. NFI is a broader measure of farm sector profitability that incorporates noncash items, including changes in inventories, economic depreciation and gross imputed rental income.
The forecasted 2024 NFI decrease follows a decrease of $37.2 billion from 2022 to $159.2 billion in 2023. These decreases are from record levels in 2022, and if forecasts are realized, NCFI and NFI would fall below their respective 2003-22 averages in 2024.
Underlying these forecasts, cash receipts for farm commodities are projected to fall by $32.2 billion (6.2%) to $485.5 billion in 2024. During the same period, production expenses are expected to increase by $7.2 billion (1.6%) to $455.1 billion in 2024.
Also, total commodity insurance indemnity payments are forecast to fall by $1.5 billion (6.6%) in 2024, and direct government payments to farmers are projected to fall by $2.2 billion (17.7%) from 2023 levels to $10.2 billion in 2024. — USDA ERS
