The Department of Agriculture updated net farm income projections for 2022 on Thursday. Micheal Clements shares the details.
Clement: The USDA’s Economic Research Service released its September 2022 farm income forecast on Thursday. American Farm Bureau Federation economist Bernt Nelson says the USDA has revised farm income to be higher.
Nelson: Today’s report adjusted the net farm income forecast for 2022, up $7.3 billion, or 5.2% from 2021. This follows a $45.9 billion increase dollars in 2021 from 2020. ERS also adjusted the Feb. 4 net farm income projection for 2021, raising the forecast in the September report by $21.3 billion, or nearly 30%.
Clement: While benefiting from increased farm income, expenses are also higher.
Nelson: The February report showed a 17% increase from 2021 to 2022 in total agricultural spending. The September forecast increased total spending by $437.3 billion. The largest increases in spending came first from fertilizers, up 41%, and second from pesticides, up 25% from a year ago. In third place, we have fuel costs that have increased by 22% since 2021.
Clement: Nelson adds that there have been many changes in the world since the February report.
Nelson: I think the Russian invasion of Ukraine was really a wake-up call when we talk about a secure food supply. The disruption caused by the invasion caused crop prices to spike and then come back down. It’s the result of our farmers, they really got together and the production was good. That alleviated some of our supply concerns a bit.
Clement: Michael Clements, Washington.