Farm Income Outlook for 2023
by Ani Katchova, Professor and Farm Income Enhancement Chair, AEDE, OSU
Coming down from high farm incomes, high commodity prices, strong government support, and rising land values and cash rents in the last 3 years, the agricultural economy is showing signs of weakening and moderation. Farm income is expected to decrease in 2023 after several years of continued growth, with lower cash receipts, higher production expenses, and lower government payments. Long-term baseline projections show that farm income is expected to steadily decline in the next four years. Farm balance sheets are strong, with farm assets outpacing the growth in farm debt. The strong land values are expected to moderate mostly due to rising interest rates and lower farm incomes. Agricultural lenders focus on the rising interest rates as their main concern. Ag credit conditions, including ag loan demand and repayment rates, are still strong but expected to weaken and moderate. The farm economy shows resiliency but still faces many challenges and uncertainty, as farmers and agricultural stakeholders are looking forward to passing of the 2023 Farm Bill. Long-term projections raise some concerns regarding the continuation of government aid to stabilize falling farm incomes and ag credit quality.
For more information, please see the presentation slides on the Farm Income Outlook at the 2023 Ag Outlook and Policy Conference: