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Aug. 1, 2024
by Tyne Morgan, U.S. Farm Report There's a silent stress growing across rural America. Farmers are focused on growing this year's crop, hoping to outyield the low commodity prices. They're keeping their head down and trudging through the day-to-day grind, but their angst can't be ignored. Many farmers say they have a gut feeling 2024 will go down as the worst financial year they've ever had. The reality is glaring. USDA's net farm income forecast for 2024 is a $43 billion drop from 2023 to $116.1 billion. That is a 25.5% decline in just one year. What makes it even more jarring is that follows the 2023 net farm income figure, which saw a 16% drop from 2022. If USDA's forecast holds true, that will mark the most significant two-year farm income decline in U.S. history. "The $90-billion drop over a two-year period is certainly the largest dollar value drop, adjusted for inflation, that we've seen in our history," says Ben Brown, an agricultural economist with the University of Missouri. "It exceeds the previous record set in the mid-1970s. When it comes to percentage changes, we've seen larger percentage changes. But you'd have to go all the way back to the Great Depression era and the early 1930s to find bigger percentage declines." However, 2023 may end up being even worse than what USDA currently has projected. As USDA showed in the June Grain Stocks report, farmers are still holding onto a lot of their 2023 crop. In fact, USDA thinks on-farm storage is the highest since the 1980s. The reason: as commodity prices fall, farmers are reluctant to sell below the cost of production. That means USDA's 2023 net farm income forecast may be even worse than what it is today. "The big change I think we could see in an update would be the 2023 farm income numbers revised lower even from where they were," says Brown. Farmers aren't just caught trying to market the current crop growing in fields today. Many still have last year's crop sitting in bins. And corn and soybean prices are seeing another bloodbath to close out July. Farmers Hope to Outyield Low Prices To read the entire article click here. Tweet |
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