The Farm Credit Administration released a quarterly report on economic issues affecting agriculture and updated the financial condition of the Farm Credit System.
The report says the USDA is predicting farm income will stabilize near its historical average. The USDA is predicting an increase in farm income, rising from $93.3 billion in 2016 to 96.9 billion in 2017. Factors driving the gain include stronger cash receipts for cattle and calves, hogs, broilers, and dairy. Cash receipts for most crops are forecast lower for 2017. With inflation adjustment factored in, net-cash income is near the long-term average (1960 to 2016) for the second-straight year. The report also says several economic and policy issues could affect the Farm Credit System. Strong crop production levels are dragging down prices. That means increasing demand will be a key for the crop and protein sectors. The report also says changes to farm and trade policy could affect farm income and the ability of farmers to manage risk.
Concerns remain about whether or not farmers have enough liquidity to cover farm expenses and pay loans. Overall, the report says the System is safe and financially sound, and should be able to face the risks posed to agriculture.