U.S. Net Farm Income Set to Rise 6% in 2013

Posted by |12 September 2013

USDA is projecting that net farm income will total $120.6 billion in 2013, up 6% from 2012’s estimate of $113.8 billion. After adjusting for inflation, 2013’s net farm income is expected to be the second highest since 1973, USDA said.

“A return to trend yields would lead to record crop production levels and result in substantial year-end crop inventories,” USDA said. However, net cash income, which measures the difference between cash expenses and the combination of commodities sold during the calendar year plus other sources of farm income, is expected to drop by more than 10% from 2012 to $120.8 billion.

According to USDA, total expenses are expected to increase $13.1 billion to $354.2 billion, the highest on record. Rent, labor, and feed are the expense items expected to increase the most in 2013, the agency said.

“As in the last several years, increases in farm asset value are expected to exceed increases in farm debt, with farm real estate the main driving force,” USDA said, adding: “Confirming the strength of the farm sector’s solvency, both the debt-to-asset ratio and debt-to-equity ratio are expected to reach historic lows.”