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World’s most vulnerable populations consumed fewer calories a day during pandemic

Friday, October 15, 2021

Globally, food insecurity—defined as lacking access to at least 2,100 calories per day—has intensified during the Coronavirus (COVID-19) pandemic. The world’s poorest populations experienced a reduction in consistent access to food and increased food insecurity, in part because of pandemic-related income shocks. In the 76 low- and middle-income countries covered in USDA, Economic Research Service’s (ERS) International Food Security Assessment (IFSA), average daily caloric consumption for the 10 percent of these countries’ population with the lowest income fell by 3.9 percent, or 62 calories per day, in 2020 relative to 2019. Access to food for the wealthiest 10 percent of the 76 countries’ population was also affected, with daily caloric intake falling by 1.8 percent, or 77 calories, year to year. In part because of the persistent effects of COVID-19 on income levels, the number of food-insecure people in 2021 is estimated at 1.2 billion, an increase of 32 percent, or 291 million people, from the 2020 estimate. This suggests that in 2021, nearly one-third of the population of the countries included in the IFSA study will lack access to sufficient food to reach the daily nutritional target of 2,100 calories set by the Food and Agricultural Organization of the United Nations. This chart is drawn from the USDA, ERS International Food Security Assessment, 2021-31.

Robust demand for pasta spurs record durum wheat use and strong imports

Wednesday, October 13, 2021

Companies usually create pasta and couscous with durum, a specific class of wheat. The United States typically consumes about 80 million bushels of durum per year, with pasta accounting for the bulk of this consumption. Toward the end of the 2019/20 (June-May) marketing year, U.S. durum used for food manufacturing expanded sharply as consumer demand for pasta products surged with the onset of the Coronavirus (COVID-19) pandemic. Consequently, more durum was used for food manufacturing in the United States in 2020/21 and total durum food use reached a record high of nearly 88 million bushels. Not only did the domestic milling of durum for pasta increase, imports of pasta and couscous in 2019/20 rose 13 percent from the year prior. These imports surged an additional 21 percent in 2020/21. As the United States emerges from the effects of the COVID-19 pandemic in 2021/22, imports of durum grain and products are expected to remain robust despite slowing consumer demand for pasta products. Widespread drought in key durum-producing regions in 2021/22 has dampened domestic production, thus import demand is expected to remain strong. This chart is drawn from USDA, Economic Research Service’s Wheat Outlook: September 2021.

U.S. household food insecurity remained unchanged in 2020

Tuesday, October 12, 2021

In 2020, 10.5 percent of U.S. households were food insecure at least some time during the year, meaning they had difficulty providing enough food for all their members because of a lack of resources. That prevalence of food insecurity was unchanged from 2019, according to the USDA’s Economic Research Service (ERS), which monitors the food security status of households in the United States through an annual nationwide survey. Of the 10.5 percent of households that were food insecure, 3.9 percent experienced very low food security, not significantly different from 4.1 percent in 2019. In households with very low food security, the food intake of one or more household members is reduced and their eating patterns are disrupted at times because the household lacks money and other resources for obtaining food. The Coronavirus (COVID-19) pandemic began in the United States in 2020 and affected public health and the economy. Policy makers modified existing nutrition assistance programs and created new programs, and charitable organizations provided additional aid. Research studies conducted before the pandemic have shown that such increases can reduce food insecurity. This chart appears in the ERS report, Household Food Security in the United States in 2020, released September 8, 2021.

Emergency allotments, participation increase led to 66-percent increase in SNAP benefits in second half of FY 2020

Friday, October 8, 2021

The Coronavirus (COVID-19) pandemic increased the need for U.S. nutrition assistance in fiscal year (FY) 2020. To help meet this need, States with emergency or disaster declarations related to COVID-19 were allowed several flexibilities in administering the USDA’s Supplemental Nutrition Assistance Program (SNAP), including the option to provide emergency allotments to supplement regular benefits. Regular SNAP benefits are provided monthly and vary based on household size, income, and expenses. In FY 2020, emergency allotments supplemented the benefits of SNAP households receiving less than the maximum benefit, effectively raising all participating households’ monthly benefit amount to the maximum allowed for their size. The first States began issuing emergency allotments in late March 2020, and almost all States issued emergency allotments monthly through the end of the fiscal year in September 2020. SNAP participation rose to an average 42.5 million people per month in the second half of FY 2020 (April to September 2020), a 14-percent increase from 37.3 million in the first half (October 2019 to March 2020). Total SNAP benefits jumped to an average $7.7 billion a month in the second half of FY 2020, up 66 percent from $4.6 billion a month in the first half. Emergency allotments accounted for 30 percent of total benefits in the second half of FY 2020, or $2.3 billion a month. Together, these changes caused average monthly benefits per person to increase from about $125 in the first half of FY 2020 to about $181 in the second. This chart is based on a chart in the USDA, Economic Research Service’s Food and Nutrition Assistance Landscape: Fiscal Year 2020 Annual Report, released August 24, 2021.

Impact of changing capital gains taxation at death varies by farm size

Wednesday, October 6, 2021

A proposal to change the way capital gains are taxed at death would affect family farm estates differently according to the size of the farm. Under current law, most inherited assets receive a step-up in basis, which means the tax basis—the amount for determining gain or loss—of property transferred to an heir at death is increased to its current fair market value at the date of death, eliminating any capital gains tax liability on those inherited gains. The change, which was included in the American Families Plan (AFP), would end stepped-up basis for gains above $1 million for the estates of individuals or $2 million for married couples. Gains above these exemption amounts would be subject to tax at death. However, the transfer of a family farm to a family member who continues the operation would not result in a tax at death. Farm and business assets exceeding the exemption amounts would receive a carry-over basis deferring capital gains tax until the assets are sold, or until the farm is no longer family owned and operated. USDA, Economic Research Service (ERS) researchers, using modeling to evaluate potential effects of the AFP proposal, found that as family farm size increased, the estimated share of estates owing no tax at death and receiving stepped-up basis on all assets decreased, while the estimated share of estates that would receive carry-over basis increased. For small farm estates, with gross cash farm income (GCFI) less than $350,000, 83.4 percent would owe no capital gains tax at death and would receive a stepped-up basis on all assets, resulting in no change to their capital gains tax liability. Under the ERS model, that share would drop to 34.2 percent for midsize farms (those with GCFI of $350,000 to $1 million), 20.4 percent for large farms (with GCFI of $1 million to $5 million), and 3.6 percent for very large farms (with GCFI of more than $5 million). Some estates would be taxed on nonfarm gains at death and potentially could owe deferred taxes on farm gains if the heirs stop operating the farm. For those estates, the estimated share increased from 1.1 percent for small farms to 2.5 percent for very large farms. Other estates would not have to pay tax at death but could see deferred taxes on farm gains if the heirs stop operating the farm. For that group, the estimated share increased from 15.5 percent for small farms to 93.9 percent for very large farms. This chart can be found in the ERS report The Effect on Family Farms of Changing Capital Gains Taxation at Death, published September 2021.

Value of U.S. agricultural exports projected to reach new high in fiscal year 2022

Monday, October 4, 2021

USDA, Economic Research Service (ERS) projects the total value of U.S. agricultural exports to reach an all-time high in fiscal year (FY) 2022 (October–September). Higher shipments of major categories of commodities including grains and feeds, oilseeds and products, and livestock, poultry, and dairy products are primarily driving the increase in value. Total U.S. agricultural export values are projected to reach $177.5 billion in FY 2022, up from their previous high of $173.5 billion in FY 2021. Grains and feeds export values are projected up from their 5-year average, reflecting higher international demand for corn, wheat, and feeds. Oilseeds and products are projected to reach a record $43.5 billion in FY 2022. International demand for soybeans coupled with higher prices is projected to drive export values to a record high for FY 2021 before increasing further in FY 2022. Soybean meal exports also are projected to reach record value. Livestock, poultry, and dairy exports, which have averaged $29.5 billion from 2015 to 2020, are forecast to rise to $36.8 billion in FY 2022. This projected increase is led by a rise in export value for all product groups except pork, with especially strong exports in beef and dairy. Higher prices and higher traded volumes for many commodities along with the reconciliation of trade disputes all contribute to the growth in export value. This chart is drawn from data in ERS’s Outlook for U.S. Agricultural Trade, August 26, 2021, and reflects USDA’s new definition of “Agricultural Products,” which includes ethanol, distilled spirits, and manufactured tobacco products and excludes rubber and allied products.

Rates of cover crop adoption vary depending on the cash crop being planted

Friday, October 1, 2021

Farmers typically add cover crops to a rotation between two commodity or forage crops to provide seasonal living soil cover. According to data from USDA’s Agricultural Resource Management Surveys, the level of cover crop adoption varies according to the primary commodity. In the fall preceding the survey year, farmers adopted cover crops on 5 percent of corn-for-grain (2016), 8 percent of soybean (2018), 13 percent of cotton (2015) and 25 percent of corn-for-silage (2016) acreage. The adoption rate in the survey year (2017) was lowest for winter wheat. This reflects the fact that farmers typically plant cover crops around the same time as winter wheat in the fall, which makes it difficult to grow both winter wheat and a fall-planted cover crop in the same crop year. In contrast, the rate of cover crop adoption was highest on corn-for-silage fields in the 2016 survey. Because corn silage is used exclusively for feeding livestock, farmers planting corn-for-silage may also grow cover crops for their forage value. Corn-for-silage also affords a longer planting window for cover crops compared with corn planted for grain because of an earlier harvest, and cover crops can help address soil health and erosion concerns on fields harvested for silage. Harvesting corn-for-silage involves removing both the grain and the stalks of the corn plant, leaving little plant residue on the field after harvest. This chart appears in the ERS report Cover Crop Trends, Programs, and Practices in the United States, released in February 2021

Price spread for pork products increases as processing plant labor shortages continue

Wednesday, September 29, 2021

The Coronavirus (COVID-19) pandemic has continued to exacerbate longstanding labor shortages in the U.S. pork processing industry. Because the production of deboned products requires more labor, associated prices are higher than bone-in product prices, which have smaller labor requirements. Weekly price spreads between a specified assortment of deboned pork cuts and a bone-in ham weighing 23–27 pounds highlight the price differential. When labor shortages are acute—as in the spring of 2020 when COVID-19-related infections of processing plant employees caused some plants to slow or temporarily shut down production—plant managers often shift labor away from deboning activities. The price of deboned pork products then increases in accordance with reduced supplies, while bone-in product prices decline as supply expands. This results in wider price spreads. Although the price spread declined through early May 2021 as hog numbers declined in a typical seasonal pattern, it did not return to pre-COVID levels. In mid-to-late August, the price spread became increasingly variable and featured several spikes, suggesting that COVID-related impacts on the labor availability of employees is ongoing, and that price spread turbulence is continuing. This chart is drawn from the September 2021 issue of the USDA, Economic Research Service Livestock, Dairy, and Poultry Outlook.

States with strictest dicamba restrictions saw less dicamba applied after cotton planting in 2019

Monday, September 27, 2021

Dicamba is a common herbicide used to control annual and perennial broadleaf weeds. Federal and State restrictions for the use of dicamba can influence a farmer’s decision to adopt genetically engineered dicamba-tolerant (DT) seeds. In 2019, for example, Federal restrictions limited the application of dicamba on cotton fields from one hour after sunrise to two hours before sunset, limited applications to 60 days after planting cotton, and required that fields in areas with endangered plant species maintain buffers on all sides of the field. Different States imposed additional restrictions or extensions for dicamba application. For example, Georgia, Oklahoma, and Texas were among states that expanded the dicamba spraying window further into the growing season from the allowed 60 days after planting by granting Special Local Need registrations to their farmers, which were allowed at the time. Data from USDA’s 2019 Agricultural Resource Management Survey show that, in States with earlier dicamba cut-off dates, less dicamba was applied after planting during the growing season. In Arkansas and Louisiana, where cut-off dates occur early in the growing season, 16 percent and 23 percent, respectively, of DT cotton acres were sprayed with dicamba after planting in 2019. By contrast, Georgia allows dicamba spraying until one week before harvest, which can occur as late as December. About 57 percent of DT cotton acres received after-planting applications of dicamba in Georgia in 2019. In 2020, the U.S. Environmental Protection Agency instituted a single nationwide cut-off date of July 30. This chart appears in the July 2021 Amber Waves data feature, “Adoption of Genetically Engineered Dicamba-Tolerant Cotton Seeds is Prevalent Throughout the United States.”

Chicken products labeled 'raised without antibiotics' and 'organic' command higher prices than conventional chicken products

Friday, September 24, 2021

Processed chicken products whose labels show they were raised without antibiotics (RWA) were on average $2.23 per pound more expensive than conventional chicken products between 2012 and 2017, representing a 55-percent markup over conventional products. Processed chicken products include fresh or frozen chicken products that are cooked, marinated, breaded, or fried. A recent USDA, Economic Research Service (ERS) report shows consumer awareness of antibiotic use in meat and poultry production has increased over the past decade, and a growing market has emerged for chicken products that carry an RWA label. Though raising animals without antibiotics can be costly, producers can benefit from doing so when consumers are willing to pay higher prices for RWA products. Analyzing national household scanner data and a constructed dataset of chicken product labels, ERS researchers also found prices for organic processed chicken products were higher than those with RWA labels. From 2012 to 2017, prices for organic processed chicken products were on average $5.13 a pound more than conventional chicken products, representing a 125-percent total markup. These price differences suggest there are significant market opportunities for production practices that fall somewhere between conventional and the standards required for organic production. This information is drawn from the ERS report, The Market for Chicken Raised without Antibiotics, 2012-17, released September 2021.

How proposed capital gains tax changes could affect estates of family farms

Wednesday, September 22, 2021

The American Families Plan (AFP) that President Joe Biden announced in April 2021 included a proposal to make accumulated gains in asset value subject to capital gains taxation when the asset owner dies. Under current law, asset value gains can be passed on to heirs without being subject to capital gains taxation because the value of the assets are reset to the fair market value at the time of inheritance. This adjustment in asset valuation, known as a “stepped-up basis,” eliminates capital gains tax liabilities on any gains incurred before the assets were transferred to the heirs. AFP also included a provision that would exempt from capital gains taxes $1 million in gains for the estates of individuals and $2 million in gains for the estates of married couples, as well as for gains on a personal residence of $250,000 for individuals and $500,000 for married couples. Gains above these exemption amounts would be subject to tax at death. However, the transfer of a family farm to a family member who continues the operation would not result in a tax upon the death of the principal operator. Under the proposal, any remaining farm and business gains above the exemption amount would receive a “carry-over basis” that effectively defers any capital gains tax until the assets are sold or until the farm is no longer family-owned and operated. Using 2019 Agricultural Resource Management Survey data, USDA, Economic Research Service (ERS) researchers estimated that of the 1.97 million family farms in the United States, 32,174 estates would result from principal operator deaths in 2021. From these farm estates, the ERS model used to evaluate potential effects of the AFP proposal estimated that heirs of 80.7 percent of family farm estates would have no change to their capital gains tax liability upon death of the principal operator. Heirs of 18.2 percent of family farm estates would not owe taxes at the time of the principal operator’s death but could be subject to a future potential capital gains tax obligation on inherited farm gains if the heirs stop farming. Heirs of 1.1 percent of estates would owe tax on nonfarm gains upon death of the principal operator and have a future potential capital gains tax obligation resulting from inherited farm gains if the heirs stop farming. This chart can be found in the ERS report The Effect on Family Farms of Changing Capital Gains Taxation at Death, published September 2021.

Slowing beef imports lead to smaller U.S. supplies, drive up prices

Monday, September 20, 2021

Reduced supplies and rising demand for ground beef in the United States could potentially be reflected in the cost of fall tailgating parties across the Nation. While the United States is a major global supplier of beef, it also imports beef and processing-grade beef (used for ground beef) to meet a growing consumer demand. Historically, Australia is the predominant supplier of processing-grade beef to the United States, with smaller amounts coming from Brazil, Canada, and New Zealand, among other countries. As Australia rebuilds its cattle herd after a two-year drought, suppliers in that country are curtailing slaughter, limiting the amount of exportable beef and increasing the prices of those exports. In February 2021, imports from Australia reached a price of $240 per hundredweight (cwt) for 90-percent lean beef, and the volume dropped to under 17 million pounds, almost 27 million pounds lower than the 5-year average. In July 2021, that price rose to $274 per cwt. From January to July 2020, beef imports from Australia accounted for 20 percent of all U.S. beef imports whereas in 2021 Australia accounted for 12 percent. Intermittent monthly imports from other countries have partly offset reduced imports from this key partner. Meanwhile, as the economy reopens, the demand for beef and ground beef is expected to support beef prices. This chart is drawn from the USDA, Economic Research Service’s September 2021 Livestock, Dairy, and Poultry Outlook.

China’s wheat imports reach highest level in more than two decades

Friday, September 17, 2021

China is the world’s largest consumer of wheat, accounting for 19 percent of global wheat consumption in marketing year 2020/21 (July–June), more than four times the U.S. share. China also became a leading importer during 2020/21, with purchases estimated at 10.6 million metric tons, China’s highest import total since the 1990s. USDA forecasts China’s 2021/22 imports at 10 million metric tons. Before the 2010/11 marketing year, China’s wheat imports typically totaled 1 million metric tons or less. More recently, wheat imports totaled 3 to 5 million metric tons most years between marketing years 2011/12 to 2019/20. The surge in imports in 2020/21 can be attributed to China’s strong demand for wheat use in animal feed, replenishment of the Chinese Government reserves with high-quality wheat, and efforts to meet import commitments in the U.S.-China Phase One trade agreement. According to China’s customs data, the United States supplied 3 million metric tons of 2020/21 wheat imports—approximately a 28-percent share. This chart first appeared in the USDA, Economic Research Service (ERS) report, Potential Wheat Demand in China: Applicants for Import Quota, August 2021, and includes updated data from ERS’ Wheat Data product.

In fiscal year (FY) 2020, USDA’s four largest child nutrition programs provided the fewest meals since FY 2001

Wednesday, September 15, 2021

The USDA’s largest child nutrition programs—the National School Lunch Program (NSLP), School Breakfast Program (SBP), Child and Adult Care Food Program (CACFP), and Summer Food Service Program (SFSP)—served about 7.9 billion meals in fiscal year (FY) 2020, the lowest number of meals served since FY 2001. This was a 17 percent decline from the average of 9.5 billion meals served annually by the programs from FY 2015 through FY 2019. The decrease is primarily attributable to the Coronavirus (COVID-19) pandemic, which disrupted in-person attendance at schools and childcare providers—through which NSLP, SBP, and CACFP typically operate—nationwide beginning in March 2020. To help facilitate the continued provision of meals to children and adolescents during these disruptions, USDA issued waivers allowing for greater flexibility in the administration of the child nutrition programs and expanded the scope and coverage of its summer feeding programs, including SFSP. Despite the overall decline in meals served, the number of meals served through SFSP rose substantially in FY 2020. The SFSP’s share of total meals served increased to 16.0 percent in FY 2020 from 1.5 percent in FY 2019. Comparatively, NSLP’s share of meals shrank to 41.0 percent in FY 2020 from 51.2 percent in FY 2019. Though less drastic, SBP’s and CACFP’s share of all meals served also decreased, to 23.1 percent in FY 2020 from 25.8 percent in FY 2019 for SBP and 19.8 percent in FY 2020 from 21.6 percent in FY 2019 for CACFP. Because of disruptions and changes to the child nutrition landscape in FY 2020, total spending on all four programs amounted to $21.1 billion, down from average annual expenditures of $22.9 billion in the previous five fiscal years. This chart is based on a chart in the USDA, Economic Research Service’s The Food and Nutrition Assistance Landscape: Fiscal Year 2020 Annual Report.

Use of pressurized irrigation systems in the western United States roughly doubled from 1984 to 2018

Monday, September 13, 2021

There are two methods to apply irrigation water to crops: gravity or pressurized irrigation systems. Gravity irrigation systems use on-field furrows, basins, or poly-pipe to advance water across the field surface through gravity means only. Pressurized systems apply water under pressure through pipes or other tubing directly to crops (e.g., sprinkler and micro/drip irrigation systems). Under many field conditions, pressurized irrigation systems use water more efficiently than gravity systems, as less water is lost to evaporation, deep percolation, and field runoff. Over the last 30 years, the number of acres irrigated using pressurized irrigation systems roughly doubled while the acreage irrigated using gravity systems declined substantially in the 17 Western States. In 2018, 72 percent of all irrigated cropland acres (28.96 million acres out of 40.31 million acres of total irrigated area) in 17 Western States used pressurized irrigation systems, up from 37 percent in 1984. This chart appears in the USDA, Economic Research Service topic page for Irrigation & Water Use, updated August 2021.

H-2A certifications increased 225 percent between 2010 and 2019

Friday, September 10, 2021

H-2A is a Federal program that allows employers in the United States to bring in foreign workers on short-term labor contracts when farm operators cannot find enough domestic workers. Over the last decade, H-2A positions certified by the U.S. Department of Labor increased 225 percent—from 79,175 in 2010 to 257,674 in 2019. Each position certified was placed within one of the five product categories: animal products, field crops, fruit and tree nuts, greenhouse and nursery, and vegetables and melons. All categories experienced some growth in program use over the period, but growth was highest in the vegetables and melons and fruit and tree nuts categories. The number of H-2A positions certified in the vegetables and melons category increased from 20,584 in 2010 to 88,863 in 2019—an increase of 332 percent. This chart appears in the Economic Research Service report, Examining Growth in Seasonal H-2A Agricultural Labor, released August 2021.

Food insecurity among U.S. children increased in 2020

Wednesday, September 8, 2021

The USDA, Economic Research Service (ERS) monitors the prevalence of food insecurity in U.S. households and breaks out data for households with children as well as children within these households. In 2020, the prevalence of food insecurity increased among U.S. households with children even though food insecurity for all households—those with and without children—remained about the same as the previous year. In 2020, 14.8 percent of households with children were food insecure, up from 13.6 percent in 2019. Children were food insecure in 7.6 percent of households with children in 2020, up from 6.5 percent in 2019. Households with food insecurity among children were classified as such because they were unable at times to provide adequate, nutritious food for their children. ERS researchers also found an increase in the most severe category of food insecurity—very low food security among children. In 2020, the share of households with children with very low food security among children was 0.8 percent, up from 0.6 percent in 2019. In that group, households reported that at times during the year children were hungry, skipped a meal, or did not eat for a whole day because there was not enough money for food. Monitoring children’s food security helps inform and improve USDA’s federally funded child nutrition programs. This chart appears in the ERS report, Household Food Security in the United States in 2020, released September 8, 2021.

Number of U.S. honey bee colonies rises as honey yield per colony drops

Tuesday, September 7, 2021

Over the last 20 years, the U.S. beekeeping industry has experienced significant changes that have included fluctuating honey bee colony numbers coupled with per colony honey yield declines. Through 2008, bee disease and elevated overwinter losses contributed to declining colony counts. In 2008, U.S. honey bee colonies totaled 2.3 million, the lowest on record. Reflecting the trend of retraction for much of the decade, the average number of U.S. colonies through the first 10 years of the 2000s totaled 2.49 million. As beekeepers adapted to bee disease challenges and overwinter losses lessened, the number of colonies began to steadily recover. The average number of colonies in the most recent decade was 2.7 million – nearly 8 percent more than in the prior 10 years. Even though colony numbers have largely recovered in the last decade, per colony honey yields have declined at a rate of about half a pound per year. From 2000 to 2009, the average U.S. colony produced 69 pounds of honey. In the most recent decade, that average slipped to 57 pounds. In addition to producing honey, honey bees provide pollination services, the demand for which has surged over the last 20 years. USDA’s Economic Research Service (ERS) recently reported that beekeepers now receive about as much of their income from providing pollination services as from producing honey. This chart is drawn from the ERS Sugar and Sweeteners Outlook, June 2021.

Employment in U.S. agriculture grew 9 percent between 2010 and 2020

Friday, September 3, 2021

Data from the U.S. Bureau of Labor Statistics’ Quarterly Census of Employment and Wages (QCEW) show that wage and salary employment in agriculture was stable in the 2000s. Starting in 2010, it gradually increased from 1.07 million jobs to 1.17 million jobs in 2020—a gain of 9 percent. From 2010-20, growth was fastest in the livestock sub-sector, which added 41,300 jobs, an 18 percent increase, and in crop support services, which added 38,000 jobs, a 13 percent increase. Firms in the crop and livestock support sub-sectors provide specialized services to farmers including farm labor contracting, custom harvesting, and animal breeding services. By comparison, employment of direct hires in the crop sub-sector, which has the largest number of hired farm workers, remained essentially unchanged. Data from QCEW is based on unemployment insurance records, not on surveys of farms or households. As a result, it does not cover smaller farm employers in States that exempt such employers from participation in the unemployment insurance system. However, survey data from sources such as the American Community Survey and the Current Population Survey also showed rising farm employment since the turn of the century. This chart appears in the Economic Research Service topic page for Farm Labor, updated August 2021.

U.S. farm sector profits forecast to increase in 2021

Thursday, September 2, 2021

USDA’s Economic Research Service forecasts inflation-adjusted net cash farm income (NCFI)—gross cash income minus cash expenses—to increase by $19.8 billion (17.2 percent) from 2020 to $134.7 billion in 2021. U.S. net farm income (NFI) is forecast to increase by $15.0 billion (15.3 percent) from 2020 to $113.0 billion in 2021. Net farm income is a broader measure of farm sector profitability that incorporates noncash items, including changes in inventories, economic depreciation, and gross imputed rental income. If this forecast is realized, NFI would be 20.4 percent above its 2000–20 average and would be the highest since 2013. NCFI would be 18.9 percent above its 2000–20 average and would be the highest since 2014. Underlying these forecasts, cash receipts for farm commodities are projected to rise by $51.2 billion (13.8 percent) from 2020 to 2021, their highest level since 2015. Production expenses are expected to grow by $12.9 billion (3.5 percent) during the same period, somewhat moderating income growth. Additionally, direct Government payments to farmers are expected to fall by $19.3 billion (40.8 percent) in 2021 compared with 2020’s record high payments. This decline is largely caused by lower anticipated payments from supplemental and ad hoc disaster assistance for Coronavirus (COVID-19) relief. Find additional information and analysis on the USDA, Economic Research Service’s topic page for Farm Sector Income and Finances, reflecting data released on September 2, 2021.

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