Farm Exports Improve But Incomes Continue to Decline
Farm sector profitability is forecast to decline for the third straight year. Net cash farm income for 2016 is forecast at $90.1 billion, down 14.6 percent from the 2015 estimate. Net farm income is forecast to be $66.9 billion in 2016, down 17.2 percent. If realized, 2016 net farm income would be the lowest since 2009.
Overall, cash receipts are forecast to fall 6.2 percent in 2016. This is due to a 12.3 percent drop in animal/animal product receipts. Crop receipts are forecast essentially unchanged from 2015.
Nearly all major animal specialties — including dairy, meat animals, and poultry/eggs—are forecast to have lower receipts, including a 14.8-percent drop, or $11.6 billion, in cattle/calf receipts.
A marginal expected gain in crop cash receipts is driven largely by an increase in oil crop receipts, primarily soybeans. Feed crops, mostly corn, are down by 3.8 percent. Vegetables/melons are down by 6.9 percent.
Cotton has emerged as the silver-lining crop. It is expected to increase by 17.5 percent to $900 million. Cotton exports are forecast at $4.4 billion, which is a $200 million increase.
The good news in animal/animal product receipts belongs to the turkey, which is up by 10.6 percent, or $600 million.
And, there is good news in projected exports. Analysts forecast $134 billion in agriculture exports in fiscal year 2017, which is a $1 billion increase. The increases are expected primarily in dairy and livestock byproduct exports. Grain and feed exports are forecast to increase by $300 million to $29.6 billion. Sources: USDA, Amber Waves magazine