COLUMBIA, Mo. — Producers have seen a sharp increase in net farm income this year, led by higher commodity prices but projections for 2022 do not appear as optimistic according to the Food and Agriculture Policy Research Institute (FAPRI) at the University of Missouri.
In addition to this year’s general across the board increase in commodity prices, government payments collectively hit $18 billion, leading to the highest level of net farm income since 2013.
Increasing input costs, combined with the loss of most ad-hoc payments from the government will open the door to tighter operating budgets even though expected cash receipts at the farm level are expected to remain about the same, year over year.
FAPRI also projects net farm income to remain fairy steady over the next five years with values returning to 2019 levels. Also lower projected farm income will apply the brakes to rising farm real estate values in 2023.
Researchers warn, however, that these estimates do not factor in market uncertainty and even small proportional changes in market receipts or production expenses can dramatically change the outlook for net income.
(SOURCE: All Ag News)
