Farm Business Income

Average Net Cash Farm Income for U.S. Farm Businesses Forecast Up in 2019

Farm businesses (farms with annual gross cash farm income of over $350,000 or smaller operations where farming is reported as the operator's primary occupation) account for less than half of U.S. farms, but contribute over 90 percent of the farm sector’s value of production and hold the majority of its assets and debt. Average net cash farm income (NCFI) for farm businesses* is forecast at $75,000 in nominal terms in 2019, up 9.3 percent from 2018. This would be the first annual increase after 4 consecutive years of declines.** 

Higher NCFI means more cash available to pay down debt, pay taxes, cover family living expenses, and invest. It is not a comprehensive measure of profitability, however, because it does not account for changes in noncash income, including adjustments in farm inventory, accounts payable, accounts receivable, and capital consumption.

Average NCFI is forecast to increase in 2019 across all farming regions and most commodity specializations. Farm businesses specializing in dairy are forecast to see the largest increase in average NCFI in 2019, driven primarily by higher cash receipts.

See data tables on farm business average net cash income, including: 

NCFI Expected To Increase for Most Types of Farm Businesses

Average net cash farm income for farm businesses specializing*** in cotton, corn, soybeans, specialty crops, and other crops is expected to increase in 2019; NCFI for farm businesses specializing in wheat is expected to decline. Among farms specializing in crop production, farm businesses specializing in cotton are expected to undergo the largest dollar and percentage increases (up $26,400 per farm, or 12.1 percent) due to expected higher cash receipts and lower production expenses. In contrast, average NCFI for farm businesses specializing in wheat is expected to decrease (down $1,900 per farm, or 2.0 percent), due largely to lower government payments.

Average net cash farm income (NCFI) for farm businesses specializing in crop production, 2019F compared with 2018F
Farm specialization Average NCFI, 2019F Change in average NCFI, 2018F-19F
  Dollars Percent
Wheat $92,300 -2.0
Corn $150,900 6.6
Soybeans $101,100 6.0
Cotton $245,300 12.1
Specialty crops 1/ $187,700 7.3
Other crops $70,600 4.6
Source: USDA, Economic Research Service, Farm Income and Wealth Statistics data product, Farm business average net cash income by commodity specialization and region. Data as of March 6, 2019.
1/ Specialty crops include fruit and tree nuts, vegetables, and nursery/greenhouse. 

Average NCFI for livestock farm businesses specializing in all types of livestock production except hogs is forecast to increase in 2019, with the largest increases—both in dollar and percentage terms—for farms specializing in dairy. Average NCFI for dairy farms is forecast to increase 35.1 percent to $186,800 per farm due to expected higher cash receipts from higher milk prices in 2019. Average NCFI for farm businesses specializing in hogs is expected to decrease 4.0 percent to $208,900 per farm, following lower cash receipts.

Average net cash farm income (NCFI) for farm businesses specializing in animals/animal products production, 2019F compared with 2018F
Farm specialization Average NCFI, 2019F Change in average NCFI, 2018F-19F
  Dollars Percent
Cattle/calves $23,200 19.0
Hogs $208,900 -4.0
Poultry $90,300 0.7
Dairy $186,800 35.1
Other livestock $14,100 2.9
Source: USDA, Economic Research Service, Farm Income and Wealth Statistics data product, Farm business average net cash income by commodity specialization and region. Data as of March 6, 2019.

Average Net Cash Farm Income (NCFI) for Farm Businesses Forecast To Increase Across All Regions in 2019

Regional performance of farm businesses can vary considerably due to the strong geographic concentration of certain production specialties. But, all nine resource regions (see ERS resource regions) are expected to see average NCFI increase in 2019 by 5 percent or more. Higher livestock receipts for 2019 are expected to contribute to a forecast 17.9-percent increase in average NCFI for the Eastern Uplands to $11,200 per farm. Farm businesses in the Fruitful Rim are forecast to see the largest dollar increase in average NCFI at $14,000 per farm (11.6 percent) to $134,700, largely due to higher crop receipts.


*Farm businesses are defined as operations with gross cash farm income of over $350,000 (labeled "commercial") or smaller operations where farming is reported as the operator's primary occupation (labeled "intermediate"). Approximately 11 percent of U.S. farms are commercial and 37 percent are intermediate. "Residence farms" comprise the remaining 52 percent of operations. These are small farms operated by those whose primary occupation is something other than farming.

**Changes in questionnaire design in the 2017 Agricultural Resource Management Survey (ARMS) contributed to a change in the share of farming operations classified as farm businesses. That share was 48.5 percent in the 2017 ARMS survey, compared with 40.2 percent in 2016 and 41.0 percent in 2015. More principal operators on smaller farms reported their primary occupation as "farming" rather than "retired" in 2017. These farms are considered farm businesses. As a result of this change in the composition of this group, caution should be used in comparing data from 2017 through the current forecast with data from earlier years.

***Commodity specialization is determined by a farm business having at least 50 percent of the value of production from a particular commodity. Farm businesses often produce multiple commodities, so average net cash farm income statistics should not be interpreted as resulting solely from the production and sale of the commodity highlighted as the commodity specialization.

Last updated: Wednesday, March 06, 2019

For more information contact: Farm Income Team