Key Takeaways:
- Net Farm Income Decline: The 2024 Farm Sector Income Forecast projects a decrease from the record high of 2022 but remains above the 20-year average.
- Challenges for Crop Producers: Crop producers continue to face difficulties due to market shocks, though input costs like feed, fuel, and fertilizer are expected to decrease.
- Livestock Income Increases: The forecast shows an increase in income for livestock producers, despite lower commodity prices.
- Off-Farm Income Reliance: 90% of farm households still rely on off-farm income, raising concerns about consolidation and the loss of family farms.
Secretary Vilsack’s Statement on Farm Sector Income Forecast
Agriculture Secretary Tom Vilsack issued a statement in response to the Economic Research Service’s 2024 Farm Sector Income Forecast. The report indicates that while net farm income is projected to decline from the record high of 2022, the 2024 income levels will still mark four consecutive years of earnings above the 20-year average. For the four years prior, net farm income remained at or below this historic average.
Challenges and Improvements in the Forecast
Secretary Vilsack acknowledged the ongoing challenges for crop producers, particularly those affected by market disruptions such as Russia’s war in Ukraine. “Despite a softening of input costs, returns to crop producers remain a challenge,” Vilsack stated. However, the 2024 forecast shows improvements compared to the February forecast, with income for livestock producers expected to rise and production expenses—led by feed, fuel, and fertilizer—projected to decline, helping offset lower commodity prices.
Farmers’ equity in their operations has also increased, with a reported 2.7% rise since last year, signaling ongoing growth in farm assets.
Concerns Over Off-Farm Income Reliance
Vilsack expressed concern about the continued reliance on off-farm income for 90% of farm households. He highlighted that this trend, which has persisted since the 1980s, threatens the sustainability of family farms and contributes to farm consolidation. “No one in rural America should be ok with [this],” Vilsack said, warning that continued consolidation could further harm the agricultural landscape.
Biden-Harris Administration’s Support for Farmers
The Secretary emphasized the Biden-Harris Administration’s efforts to create a more resilient and diversified food and farm sector. He pointed to initiatives that promote climate-smart conservation, on-farm renewable energy, domestic fertilizer production, expanded local meat processing, organic markets, and procurement from smaller farms. Vilsack stressed the importance of supporting farms of all sizes, not just top earners.
He also called for continued investment in crop insurance to help farmers manage risks posed by natural disasters and global market disruptions. In looking ahead to the next Farm Bill, Vilsack underscored the need to move away from a “get big or get out” approach, advocating for policies that ensure the survival of family farms and a diversified agricultural system.
