USDA released its first projected net farm income forecast for 2024 last week. The report pegs a decrease from last year’s $155 billion to $116 billion. The 25.5% drop is the largest on record for year-to-year projections and the second consecutive drop since record-high income levels in 2022. USDA says government payments are estimated to fall by $1.9 billion in 2024 to just over $10 billion or about 9% of overall farm income.

This is the fourth consecutive decrease since the COVID-19 pandemic. Ad hoc and supplemental program payments like those from the Emergency Relief Program (ERP), Quality Loss Adjustment Program and other designated disaster programs are projected to decline by 11% to $5.49 billion. USDA also forecasted lower cash receipts for both crops and livestock.

While overall gross income is projected to be lower, ongoing inflation and high input costs lead to a greater drop in net income. Production expenses are slated to increase by 4% to $455 billion across the U.S. This would be the sixth year in a row that production expenses increased and the fourth consecutive year that expenses hit a new high.

Read more on 2024 net farm income projections here.