There are some opposing views of the USDA’s September Net Farm Income Report. That’s coming up on This Land of Ours.
Administrator of USDA’s Economic Research Service, Spiro Stafanou, says despite a forecast calling for lower farm incomes this year, the financial health of the farm sector is still strong.
“It comes to the balance sheet for the ag sector. Overall, equity is increasing about two-point-seven percent. This is driven by farmland values and building values. And those farmland and buildings account for about eighty percent of farm assets. Debt has also increased, but at a slower rate at about one-point-six percent,” he said. “So, on balance we see the debt-to-equity ratio falling, which is an improvement and so is the debt-to-asset ratio that’s falling.”
He said prices that farmers are getting for many of their crops continued to fall. USDA protecting a 12% drop in crop receipts. But he points out that it’s offset a little by a 1% drop in production expenses. He also says direct government payments to farmers will be lower in 2024 than last year.
“Government payments from farm programs are expected to fall about fifteen percent in 2024, to just over ten billion dollars, about ten-point-four billion dollars. So, this decrease primarily reflects just lower anticipated dairy margin coverage, program payments and direct payments from these supplemental and ad hoc disaster assistance payments that we saw in 2023,” he said. “Since 2020, supplemental and ad hoc disaster assistance has represented the largest category of direct government payments. So, as those programs get wound down, the impact of direct government payments is to be moderated.”
However, House Committee on Agriculture Chairman Glenn “GT” Thompson (PA-15) has a different take.
“USDA’s September update to the farm financial outlook continues to present a bleak picture. Declining commodity prices, record farm production costs driven by the reckless spending of the Biden-Harris Administration, the largest agricultural trade deficit on record, and an outdated farm safety net threaten to wipe out family farms across the country,” he said in an emailed news release. “These numbers are more than data points on spreadsheets. They tell a story of struggling American farmers desperate for relief, certainty, and stability. The bipartisan Farm, Food, and National Security Act of 2024 is the legislative remedy our rural communities so desperately need.
Thompson said, “It’s time to put partisan bickering and red lines aside and pass a farm bill.”
Sabrina Halvorson
National Correspondent / AgNet Media, Inc.
Sabrina Halvorson is an award-winning journalist, broadcaster, and public speaker who specializes in agriculture. She primarily reports on legislative issues and hosts The AgNet News Hour and The AgNet Weekly podcast. Sabrina is a native of California’s agriculture-rich Central Valley.