Farm Business Income

Average Net Cash Farm Income for U.S. Farm Businesses Forecast Down in 2018

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) is forecast at $93,200 in nominal terms for farm businesses* in 2018, down 7.3 percent from 2017. This decline is consistent with NCFI for the whole farm sector, which is forecast to decrease by 5.1 percent (nominal).

Lower NCFI means less cash available to draw 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 noncash income changes, including adjustments in farm inventory, accounts payable, accounts receivable, and capital consumption.

Average NCFI is forecast to decline in 2018 across all farming regions and most commodity specializations. Driven primarily by lower cash receipts, farm businesses specializing in wheat and dairy are forecast to undergo double-digit decreases in average NCFI in 2018. As a result, the regions of the country with higher concentrations of farms producing these commodities (e.g., Northern Crescent) are forecast to have a larger percentage decline in average net cash farm income.

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

NCFI Expected To Decline for Nearly All Types of Farm Businesses

Average net cash farm income for farm businesses specializing** in all types of crop production is expected to decrease in 2018, with farms businesses specializing in wheat expected to experience the largest percentage decline (at 21.8 percent, a decline of $8,900). The largest dollar decline is forecast for cotton farm businesses (with a $44,400 decline, or 9.1 percent).

Average net cash farm income (NCFI) for farm businesses specializing in crop production, 2018F compared with 2017F
Farm specialization Average NCFI, 2018F Change in average NCFI, 2017F-2018F
  Dollars Percent
Wheat $32,000 -21.8
Corn $131,500 -7.5
Soybeans $108,600 -6.3
Cotton $441,400 -9.1
Specialty crops $235,200 -7.8
Other crops $72,400 -6.7
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 February 7, 2018.
  • Average NCFI for farm businesses specializing in wheat is forecast to decline nearly 22 percent in 2018 due to lower Government payments and higher cash expenses. Wheat farm businesses have the lowest average net cash farm income across all farm specialization types.

  • After a substantial increase in NCFI in 2017, cotton farm businesses are forecast see a decline in NCFI in 2018 due to lower cash receipts expected for upland and long-staple cotton lint.

Average NCFI for farm businesses specializing in most types of livestock production is forecast to decrease in 2018, with the largest decreases—both in dollars and percent change—for farms specializing in dairy.

Average net cash farm income (NCFI) for farm businesses specializing in animals/animal products production, 2018F compared with 2017F
Farm specialization Average NCFI, 2018F Change in average NCFI, 2017F-2018F
  Dollars Percent
Cattle/calf $36,100 6.2
Hogs $256,500 -5.7
Poultry $106,800 -5.2
Dairy $215,600 -19.2
Other livestock $20,000 0.5
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 February 7, 2018.
  • Following a forecast increase in 2017, dairy farms are forecast to experience the largest decrease in NCFI of any livestock specialization—in both dollar ($51,300) and percentage (19.2 percent) terms—reflecting anticipated decreases in milk prices.

  • Cattle/calf farm businesses are forecast to have higher (6.2 percent) NCFI in 2018, with higher output expected to raise cash receipts.

Average Net Cash Farm Income for Farm Businesses Lower Across All Regions in 2018

Regional performance can vary considerably due to the strong geographic concentration of certain production specialties. Nonetheless, all of the nine resource regions (see ERS resource regions) are expected to see lower NCFI in 2018. 

  • Dairy’s weak forecast performance for 2018 is expected to affect many regions, contributing to a forecast 12.4-percent decrease in average NCFI for the Northern Crescent to $62,000.

  • The expected decline in dairy and vegetable/melon cash receipts is expected to lower average NCFI for the Fruitful Rim to $195,300 in 2018, down 9.8 percent from 2017.

  • Average Mississippi Portal NCFI is expected to decline 12.2 percent in 2018 to $77,000, driven primarily by higher expenses and lower crop receipts.

  • Heartland farm businesses—with expected lower corn receipts/Government payments and higher expenses—are forecast to have an average NCFI of $119,400 in 2018, down 6.2 percent from 2017.

  • Farm businesses in the Basin and Range are forecast to see a 7.8-percent decrease in average NCFI to $42,300. For the Southern Seaboard, average NCFI in 2018 is expected to be down $4,000 (7.5 percent).

  •  Farm businesses in the Eastern Uplands are expected to have average NCFI down 3 percent, to $15,900, in 2018.

  •  Higher cattle/calf receipts for farm businesses in the Prairie Gateway and Northern Great Plains are expected to partially offset lower crop cash receipts/Government payment and higher expenses, for a forecast decrease in average NCFI of 2.6 percent and 3.5 percent, respectively.


*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 10 percent of U.S. farms are commercial and 30 percent are intermediate. "Residence farms" comprise the remaining 60 percent of operations. These are small farms operated by those whose primary occupation is something other than farming.

**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.