Farm sector profits forecast to rise in 2020

This line chart shows the net farm income and cash farm income from 2000 to the 2020 forecast as of December 2, 2020.

Inflation-adjusted U.S. net cash farm income (NCFI)—gross cash income minus cash expenses—is forecast to increase $23.4 billion (21.1 percent) to $134.1 billion in 2020. U.S. net farm income (NFI), a broader measure of farm sector profitability that incorporates noncash items including changes in inventories, economic depreciation, and gross imputed rental income, is forecast to increase $35.0 billion (41.3 percent) from 2019 to $119.6 billion in 2020. While cash receipts for farm commodities are forecast to fall $7.8 billion (2.1 percent), direct Government payments are expected to rise to $46.5 billion, more than twice the 2019 amount, a result of supplemental and ad hoc disaster assistance payments for COVID-19 relief in 2020. Total production expenses, which are subtracted out in the calculation of net income, are projected to fall $9.5 billion (2.7 percent) in 2020, including a drop of $5.6 billion in interest expenses. If forecasts are realized, NFI in 2020 would be at its highest level since 2013 and 32.0 percent above its inflation-adjusted average calculated over the 2000-19 period. NCFI would be at its highest level since 2014 and 22.5 percent above its 2000-19 average. Find additional information and analysis on the USDA, Economic Research Service Farm Sector Income and Finances topic page, reflecting data released December 2, 2020.

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