During an address of the House Agriculture Committee earlier this week, Agriculture Secretary Sonny Perdue called the farm economy “fragile,” and the latest net farm income forecast is reflecting that.
In the first forecast of 2018, the U.S. Department of Agriculture (USDA) is predicting farm profits to dwindle 6.7 percent to $59.5 billion, which is the lowest it’s been since 2006.
In the last four years, net farm income has plummeted roughly 50 percent. Factoring in inflation, the 2018 forecast could be the worst year since 2002.
“Credit conditions are going to be similar to what they were last year,” said Ashley Arrington, founder of AgriAuthority. “Bankers are still going to up the ante and ask for more information because of how the climate has been the past couple of years.”
This report could put more pressure on lawmakers to get to work on the 2018 farm bill.
“A safety net is really the goal of the farm bill as well as providing for those who don’t have the resources for enough food,” said Perdue during his testimony. “There are a lot of challenges out there.”
The USDA is predicting crop revenues for 2018 to drop 0.8 percent to $188.2 billion. Livestock and related products are expected to decline 0.3 percent to $174.9 billion.