The Economic Research Service (ERS) of the USDA is forecasting an 8.1 percent decrease in net farm income this year.
The drop follows a historic year in which net farm income increased by an estimated 45.7 percent, the result of programs such as the Coronavirus Food Assistance Program. Direct payments from the government to farmers in 2021 is forecast to decrease by 45.3 percent, or $21 billion, compared to 2020.
The ERS forecasts that farm cash receipts will increase by 5.5 percent this year. Total production expenses are forecast to increase 2.5 percent. The rise in costs will be tied primarily to feed, fertilizer, and labor.