CoBank: Steepest Drop in Farm Income Since Great Depression

August 30, 2016 05:00 PM
 
 

Brace yourself. According to a new study from CoBank, the drop in farm income over the past three farming seasons has been the biggest plunge since the Great Depression.

 

"The drop in farm income over the past three years is the steepest decrease since the Depression," says Tanner Ehmke, CoBank senior economist covering, the grains, oilseeds and ethanol, and farm supply sectors. "Producer incomes have fallen more than 50% from 2013 to today and their debt-to-income ratio is on the rise.”

 

 

When cash flow becomes an issue, farmers tend to put off whatever bills can wait. It’s not a surprise that total accounts receivable for ag retailers has also increased. “[Accounts receivable] posted an 11% gain for 2015, and that's expected to grow in the year ahead due to ongoing farmer cash flow challenges," Ehmke says. 

Low commodity prices are causing heartburn, and some lawmakers are frustrated the current farm bill isn’t doing enough.

“There have been real problems with the commodity title of this farm bill,” says Kristi Noem (R-South Dakota). “We’ve had some discrepancies from county to county that have impacted producers in a negative way.”

Drought plaguing the Northeast is likely to make the situation worse for farmers there as yield expectations in the region continue to evaporate.

 

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Comments

 
Spell Check

Jeff Oliver
Belgrade , MN
9/12/2016 08:33 PM
 

  I have never seen such screwed up market prices, everything is down. Usually when cattle prices are down, corn is high, vise verse but everything is down except in the store everything is still high and I won't even comment on what I think about the gas prices

 
 
Tim Bedford
Grundy Center, IA
9/7/2016 11:16 PM
 

  I think most farmers are a little embarrassed by some of the excesses during the boom years and realize that there are quite a few benefits to how current pricing is improving efficiency even while we always have the urge for higher prices. But I think the use of the term "Karma" is most interesting in the thread; modern use in the US is by coastal types as recycled primitivism. Farmers still have a social order built on Christian concepts of judgement and consequence.

 
 
Anita McAllister
Jacksonville, MO
9/10/2016 06:12 AM
 

  I agree with Tim Bedford

 
 

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