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This is some interesting information we wanted to share with you all from Dr. Will Snell, University of Kentucky College of AG, AG Economic Specialist.
Earlier this week, USDA updated their 2013 farm income forecast. According to their latest estimate (Aug. 27, 2013), U.S. net farm income is projected to total $120.6 billion in 2013; which is up six percent from 2012 and topping the previous record high of $118 billion in 2011. After accounting for inflation, the 2013 net farm income level is forecast to be the second highest on record since 1973.
Despite lower anticipated prices, increased acres and improved yields are expected to boost crop revenues. The value of livestock production is predicted to increase 5.2 percent in 2013 on the heels of higher prices. These calendar year data do reflect crop insurance payments in 2013, on 2012 crops, and anticipated unsold carryover from the 2013 crops. Government payments are expected to remain relatively stable at $11.1 billion versus 10.6 billion in 2012. Production expenses will likely also swell to record high levels, primarily in response to higher rent, labor, and feed costs.
For more details on the report go to: www.ers.usda.gov/topics/farm-economy/farm-sector-income-finances/2013-fa...
The report also provided 2012 farm income and cost data by state. According to the report, Kentucky’s net farm income in 2012 increased to $1.54 billion; which is five percent above the 2011 level and the third highest on record. Increases in livestock value will more than offset lower crop values. Government payments to Kentucky farms increased to $303 million last year (versus $274 million in 2011), accounting for nearly 20 percent of net farm income. Approximately 50 percent of these government payments ($153 million) were tobacco buyout payments, which will expire in 2014.
Conservation payments totaled $64 million (up from $58 million in 2012), while direct government payments in 2012 remained flat at $48 million. Despite lower crop prices and anticipated lower tobacco yields, look for Kentucky’s net farm income to remain relatively strong in 2013; as a result of higher livestock prices, increased grain acres and yields, and slightly lower government payments.
Specific historical income and cost data for U.S. and Kentucky agriculture can be accessed at: www.ers.usda.gov/data-products/farm-income-and-wealth-statistics/histori...