Farm Business Income

Suggested citation for linking to this discussion:

U.S. Department of Agriculture, Economic Research Service. Farm Sector Income & Finances: Farm Business Income, September 1, 2022.

Average Net Cash Farm Income for U.S. Farm Businesses Forecast to Decrease In 2022

Farm businesses are farms with annual gross cash farm income (GCFI)—i.e., annual income before expenses—of at least $350,000, or operations with less than $350,000 in annual gross cash farm income but in which farming is reported as the operator's primary occupation. Farm businesses account for half of U.S. farms, but they contribute more than 90 percent of the farm sector's value of production and hold most of its assets and debt.

Average net cash farm income (NCFI) for farm businesses* is forecast at $98,200 in calendar year 2022, down 3.3 percent from 2021 in nominal terms. NCFI encompasses cash receipts from farming as well as farm-related income, including Government payments, minus cash expenses. Lower NCFI could mean less cash is available to pay down debt, taxes, cover family living expenses, and invest. NCFI is not a comprehensive measure of profitability because it does not account for changes in noncash income, including adjustments in farm inventory, accounts payable, accounts receivable, the imputed rental value of operator dwellings, and capital consumption.

Average NCFI is forecast to decline in 2022 for most commodity specializations**  across most regions. In 2022, farm businesses specializing in dairy are forecast to see the largest increase in average NCFI, while farm businesses specializing in cotton are forecast to see the largest dollar decrease in average NCFI compared with 2021. Among the nine resource regions (see the FAQ on ERS resource regions), farm businesses in the Northern Crescent region are forecast to have the largest percent increase, whereas farm businesses in the Eastern Uplands region are forecast to have the largest percent decline in average NCFI. Despite higher cash receipts for most commodities in most regions, all major categories of farm businesses are expected to be affected by lower levels of average direct Government payments and higher expenses in 2022. See data tables on farm business average net cash income, including:

Average Net Cash Farm Income Forecast to Increase for Most Types of Farm Businesses

For all crop farm businesses—except those specializing in corn—the average NCFI is forecast to decrease in 2022. Farm businesses specializing in wheat are expected to see the largest percentage decrease (31.7 percent) with NCFI forecast at $99,000 in 2022. In addition, farm businesses specializing in specialty crops are expected to see the largest dollar decrease ($119,400 or 21.3 percent) with NCFI forecast at $145,700. For these farm businesses, growth in cash receipts is not expected to be enough to offset increases in cash expenses and declines in Government payments, on average. In contrast, farm businesses specializing in corn are expected to see a slight (1.4 percent or $3,600) increase in average NCFI in 2022 compared with 2021. However, this forecasted increase goes away when values are adjusted for inflation.

Average net cash farm income for farm businesses specializing in crop production, 2022F compared with 2021
Farm specialization Average NCFI, 2022F Change in average NCFI, 2021–22F
  Dollars Percent
Cotton $440,500 –21
Corn $270,200 1
Wheat $99,000 –32
Soybeans $116,100 -5
Specialty crops 1/ $145,700 -32
Other crops $73,600 -16
NCFI = net cash farm income; F = forecast.
1/ Specialty crops include fruit and tree nuts, vegetables, and nursery/greenhouse. 
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 September 1, 2022.

For farm businesses specializing in animals/animal products, average NCFI is forecast to increase in 2022 for those specializing in hogs, poultry, and dairy. Average NCFI is forecast to decrease for farm businesses specializing in cattle and calves and other livestock. The largest dollar and percentage increase in average NCFI is forecast for dairy farms, up $265,600 in 2021 to $648,100 and up 69.4 percent per farm in 2022. Higher average cash receipts for dairy farm businesses in 2022 are expected to more than offset lower Government payments and increased in production expenses. The largest dollar decrease in average NCFI is for farms specializing in other livestock (down from $5,600 in 2021 to $900 in 2022).

Average net cash farm income for farm businesses specializing in animals/animal products production, 2022F compared with 2021
Farm specialization Average NCFI, 2022F Change in average NCFI, 2021–22F
  Dollars Percent
Dairy $648,100 69
Hogs $508,100 2
Poultry $111,100 11
Cattle/calves $18,200 -4
Other livestock $900 -86
NCFI = net cash farm income; F = forecast.
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 September 1, 2022.

Average Net Cash Farm Income is Forecast to Decrease Across Most Regions

Regional performance of farm businesses can vary considerably because of the heavy geographic concentration of certain production specialties. Six of the nine ERS Farm Resource Regions are expected to see a decrease in average net cash farm income in 2022 compared with 2021, in nominal dollars. Farm businesses in the Fruitful Rim region are forecast to see the largest dollar ($27,600) decrease because of the forecasted decline in fruits/nuts cash receipts. Eastern Uplands are forecast to see the largest percentage decrease (23.0 percent) in average NCFI per farm business. Farm businesses in the Northern Crescent region are forecast to see the largest increase in average NCFI at 11.6 percent ($8,900) per farm. These expected increases are because of the large number of dairy farms in this region and the forecast for higher milk cash receipts in 2022.


*Farm businesses are defined as operations with gross cash farm income of more than $350,000 (labeled "commercial") or smaller operations where farming is reported as the operator's primary occupation (labeled "intermediate"). The USDA’s Agricultural Resource Management Survey data for 2021 indicate that 10.9 percent of U.S. farms are commercial and 39.8 percent are intermediate. Residence farms comprise the remaining 49.3 percent of operations; these are small farms with operators 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.