ERS: Net farm income down 13 percent not including trade payments
Net farm income, a broad measure of profits, is forecast to decrease $9.8 billion (13 percent) from 2017 to $65.7 billion in 2018, after increasing $13.9 billion (22.5 percent) in 2017, the Agriculture Department’s Economic Research Service noted Thursday.
But ERS noted that the calculation does not include the payments that farmers will receive under the trade aid package that the Trump administration has announced.
Net cash farm income is forecast to decrease $12.4 billion (12 percent) to $91.5 billion, ERS said. In inflation-adjusted 2018 dollars, net farm income is forecast to decline $11.4 billion (14.8 percent) from 2017 after increasing $13 billion (20.3 percent) in 2017.
If realized, inflation-adjusted net farm income would be just slightly above its level in 2016, which was its lowest level since 2002. Inflation-adjusted net cash farm income is forecast to decline $14.6 billion (13.8 percent) from 2017 to $91.5 billion, which would be the lowest real-dollar level since 2009.
ERS noted that net cash farm income encompasses cash receipts from farming as well as farm-related income, including government payments, minus cash expenses. Net farm income is a more comprehensive measure that incorporates noncash items, including changes in inventories, economic depreciation and gross imputed rental income of operator dwellings.
But ERS added, “The 2018 forecasts for U.S. farm sector income and finances — including government payments, net farm income, and net cash farm income — do not include payments under the Market Facilitation Program, announced on July 24, 2018.”