Net farm income and net cash farm income are expected to decrease 8.1% and 5.8%, respectively, in 2021 compared to 2020 based largely on the absence of direct farm payments that made up a large share of incomes last year. While that means 2021 inflation-adjusted net cash farm income is pegged at 7.5% lower than 2020, the projection remains 15.3% above the annual average from 2000 to 2019. In addition to the lack of government assistance, increasing production costs are expected to contribute to the slight decline, namely driven by rising spending on feed, fertilizer and labor. Despite the general declining trend, overall farm equity and assets are expected to increase slightly in the next year. See more from USDA’s latest economic outlook.
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