Net farm income, a broad measure of profits, is forecast to increase $6.3 billion (10.0 percent) from 2018 levels to $69.4 billion in 2019. This follows a $12.0-billion (16.0 percent) decline forecast for 2018. In inflation-adjusted 2019 dollars, net farm income is forecast to increase $5.2 billion (8.1 percent) from 2018 after the forecast decrease of $13.9 billion (17.8 percent) in 2018. If realized, inflation-adjusted net farm income in 2019 would be 49.0 percent below its highest level of $136.1 billion in 2013 and below its historical average across 2000-17 ($90.0 billion).
Net cash farm income is forecast to increase $4.3 billion (4.7 percent) to $95.7 billion. Inflation-adjusted net cash farm income is forecast to increase $2.7 billion (2.9 percent) from 2018, which nonetheless would be the second lowest real-dollar level since 2009. 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 the more comprehensive measure of the two, in that it incorporates noncash items, including changes in inventories, economic depreciation, and gross imputed rental income of operator dwellings.
Cash receipts for all commodities are forecast to increase $8.6 billion (2.3 percent) to $381.5 billion in 2019 in nominal terms. Total animal/animal product receipts are expected to increase $4.6 billion (2.6 percent) following expected increases in milk and cattle/calf receipts. Total crop receipts are expected to increase $4.0 billion (2.0 percent) from 2018 forecast levels following expected increases in corn and fruit/nuts receipts. Direct government farm payments are forecast to decrease $2.3 billion (16.8 percent) to $11.5 billion in 2019, with most of the decrease due to lower anticipated payments for Agriculture Risk Coverage, Price Loss Coverage and miscellaneous programs (which include Market Facilitation Program payments to assist farmers in response to trade disruptions).
Total production expenses (including operator dwelling expenses) are forecast to be largely unchanged from 2018 forecast levels, at $372.0 billion in 2019, with increases in spending on hired labor, feed, and interest mostly offset by dropping energy prices. When adjusted for inflation, total production expenses are forecast to decrease $4.2 billion (1.1 percent).
Farm business average net cash farm income is forecast to increase $6,400 (9.3 percent) to $75,000 in 2019. Although this is the first increase since 2014, it is also the third lowest average income recorded since the series began in 2010. Every resource region of the country is forecast to see farm business average net cash farm income increase by 5 percent or more. All categories of farm businesses except wheat and hog farm businesses are expected to see average net farm income rise in 2019.
Farm sector equity is forecast up by $28.8 billion (1.1 percent) in nominal terms to $2.65 trillion in 2019. Farm assets are forecast to increase by $44.6 billion (1.5 percent) to $3.1 trillion in 2019, reflecting an anticipated 1.8-percent rise in farm sector real estate value. When adjusted for inflation, farm sector equity and assets are forecast to decline $16.3 billion (0.6 percent) and $7.6 billion (0.2 percent), respectively. Farm debt in nominal terms is forecast to increase by $15.8 billion (3.9 percent) to $426.7 billion, led by an expected 5.1-percent rise in real estate debt. The farm sector debt-to-asset ratio is expected to rise from 13.55 percent in 2018 to 13.86 percent in 2019. Working capital, which measures the amount of cash that would be available to fund operating expenses after paying off debt due within 12 months, is forecast to decline almost 25 percent from 2018.
Get the 2019 forecast for farm sector income or see all data tables on farm income indicators.
Median Income of Farm Operator Households Expected To Increase in 2019
Median farm household income is forecast to reach $78,987 in 2019. In nominal terms, that income level represents an increase of 3.6 percent from its 2018 level; in inflation-adjusted terms, it is a 1.9-percent increase. The total median income of U.S. farm households increased steadily over 2010-14, reaching an estimated $81,637 in 2014 in nominal terms. Median farm household income then fell 6 percent in 2015, remained flat through 2018, and is forecast to rise in 2019.
Farm households typically receive income from both farm and off-farm sources. Median farm income earned by farm households is forecast at -$1,553 in 2018 in nominal terms and is forecast to increase slightly to -$1,449 in 2019. In recent years, slightly more than half of farm households have had negative farm income and therefore rely on off-farm income to support their well-being. Median off-farm income is forecast to increase 2.6 percent from $69,366 in 2018 to $71,162 in 2019. (Because farm and off-farm income are not distributed identically for every farm, median total income will generally not equal the sum of median off-farm and median farm income.)
Get the 2019 forecast for farm household income or see the Farm Household Income and Characteristics data product tables for financial statistics of farm operator households.
