US farm income to plunge 38 percent in 2009
Aug. 27, 2009 -Despite media warnings of continued global food shortages, the reality of the situation for US farmers is that their net farm income will be lower in 2009, possibly by as much as 38 percent, according to the USDA.
August, 27, 2009
Washington -US farm income this year was forecast to plunge 38 percent to $54 billion due to lower commodity prices for crops and livestock, the Agriculture Department said on Thursday.
Grain and livestock prices falling from record highs set in 2008 means farmers will see earnings slump by $33.2 billion in 2009 from last year's near record net farm income of $87.2 billion.
The 2009 forecast was $9 billion below the 10-year average of $63.2 billion in net farm income.
The drop comes amid a global recession that has suffocated demand for many US commodities, pushing prices well below their 2008 averages.
"With economic conditions deteriorating worldwide, demand for exports has tailed off, with few options available to expand marketing elsewhere," the USDA said in its report.
"Sharply declining demand in 2009 has forced farmers to accept prices that are lower than were expected earlier in the year when production plans were made," it said.
Net farm income is a USDA measurement of the value of production during the calendar year, whether it is sold or held in storage.