Economists confirm downturn in agriculture
The U.S. agricultural sector is reportedly in a recession, according to a majority of agricultural economists surveyed in the latest Ag Economists’ Monthly Monitor. This assessment is based on the current economic indicators and market trends impacting the sector.
The survey highlights that 60% of economists perceive a high risk of financial stress within agriculture, with over 50% confirming that the sector is already experiencing a recession. This downturn is largely driven by the lowest corn prices in four years and the prospect of record yields depressing market prices further.
Despite stronger cattle prices, which have somewhat cushioned the blow, the overall economic picture for U.S. agriculture is bleak.
The USDA Economic Research Service forecasts suggest a significant decline in farm incomes over the next two years, with net cash farm income projected to fall by over 20% in 2023 and continue declining in 2024.
This economic strain is exacerbated by high operational costs and stagnant commodity prices, leading to reduced profitability for farmers.
The economic outlook for the sector remains uncertain, with many economists expecting further downward revisions in income forecasts by the USDA, reflecting the ongoing challenges faced by U.S. agriculture.