USDA Forecasts 23 Percent Rise in 2020 Net Farm Income, Due Largely to Government Payments

 

Net farm income for U.S. producers in 2020 is forecast to rise 23 percent over 2019 figures, growing to about $102.7 billion, according to a report this week from the U.S. Department of Agriculture’s Economic Research Service.

 

 

 

The growth in overall income has occurred despite falling cash receipts for almost every sector of the agricultural economy, from row crops to cattle sales, according to an analysis prepared by James Mitchell, assistant professor of livestock marketing and management for the University of Arkansas System Division of Agriculture.

 

Mitchell’s analysis shows that the recovery is largely due to direct payments from the federal government, as well as ad hoc and emergency payments delivered in reaction to natural disasters.

 

“USDA forecasts 2020 direct farm payments at $37.2 billion, a 65.7 percent increase over 2019 direct farm payments,” Mitchell said. “These direct government payments for 2020 will account for 36.2 percent of net farm income. In 2019, direct payments accounted for 26.8 percent of net farm income.” 

 

Supplemental and “ad hoc” payments for COVID-19 pandemic relief account for most of the increase in direct farm payments, Mitchell said. While the USDA report was published on Sept. 2, it forecast farm income through Dec. 31. 

 

Overall, cash receipts for crops are forecast to rise about 1 percent over 2019, with food grains falling more than 6 percent, feed crops falling nearly 4.5 percent and cotton falling more than 7 percent. One notable rise in 2020 is cash receipts from fruits and nuts, which is forecast to rise more than 17 percent over 2019. 

 

From 2011-2018, annual direct farm program and disaster payments remained between $10 billion and $15 billion; in 2019, they exceeded $20 billion before continuing their rise to current levels. Similarly, supplemental and ad hoc disaster assistance accounted for a very small percentage of farm net income over the past decade — the most notable deviation being 2014, when such assistance accounted for 5.1 percent of net farm income. In 2020, by comparison, disaster assistance is projected to account for about 22.8 percent of net farm income, according to Mitchell’s analysis. 

 

The analysis is part of a series of impact reports regarding the COVID-19 pandemic and its effects on agriculture and other aspects of the economy from the Division of Agriculture. Find Mitchell’s analysis and others at https://bit.ly/AR-Ag-Eco-Impacts2020. 

Video: Dicamba Returns for Georgia Farmers: What the New EPA Ruling Means for Cotton Growers

After being unavailable in 2024 due to registration issues, dicamba products are returning for Georgia farmers this growing season — but under strict new conditions.

In this report from Tifton, Extension Weed Specialist Stanley Culpepper explains the updated EPA ruling, including new application limits, mandatory training requirements, and the need for a restricted use pesticide license. Among the key changes: a cap of two ½-pound applications per year and the required use of an approved volatility reduction agent with every application.

For Georgia cotton producers, the ruling is significant. According to Taylor Sills with the Georgia Cotton Commission, the vast majority of cotton planted in the state carries the dicamba-tolerant trait — meaning farmers had been paying for technology they couldn’t use.

While environmental groups have expressed concerns over spray drift, Georgia growers have reduced off-target pesticide movement by more than 91% over the past decade. Still, this two-year registration period will come with increased scrutiny, making stewardship and compliance more important than ever.