US net farm income forecast to decline in 2012

U.S. net farm income in 2012 is forecast to decline almost $4 billion from its all-time high in 2011, and net cash income is expected to decline almost $2 billion, according to the U.S. Department of Agriculture Economic Research Service's 2012 farm income forecast.
The value of agricultural sector production is expected to increase with gains anticipated for crops, livestock and especially revenues from services and forestry sales. Larger gains are predicted for oil crops and other farm income. However, solid gains in the projected annual value of U.S. agricultural production will be more than offset by increases in purchased inputs and payments to stakeholders, according to the report. In particular, feed expenses are forecast to increase almost $10 billion in 2012.
Agriculture Secretary Tom Vilsack said he is optimistic in spite of some of the numbers. "Today's forecast is heartening," said Vilsack. "It confirms that American farmers and ranchers remained impressively resilient in 2012, even with tough odds due to one of the worst droughts in more than a generation. Thanks to its ability to remain competitive through thick and thin, U.S. agriculture is stronger today than at any time in our nation's history, supporting and creating good-paying American jobs for millions.
"While down slightly from the August forecast, today's estimates for net farm income are the second-highest since the 1970s, while total farm household income is expected to rise," said Vilsack. "At the same time, the positive trend of falling debt ratios continue. The forecast suggests that strong farm income should remain a positive factor in carrying farmers and ranchers into the 2013 growing season."
He said the industry must continue to stand with America's farming families and rural communities, providing help and assistance to those who need it. "This year, the farm safety net showed its mettle and merit, helping to deliver peace of mind to thousands of farmers and ranchers dealing with losses caused by natural disasters," said Vilsack. "It's a reminder that Congress must do the same, and pass a comprehensive, multi-year Food, Farm and Jobs Bill that provides greater certainty for farmers and ranchers in the season ahead. Providing the tools and certainty they need is the least we can do for those who grow our food, fiber, feed and fuel, even through the most challenging of times."